A country can benefit by indulging in international trade when:
a. it produces a good in which it has an absolute disadvantage.
b. it produces a good in which its trading partner has an absolute advantage.
c. it produces a good in which it has a comparative advantage.
d. it produces all the goods which are supported by its resources.
e. it produces nothing and merely depends on foreign imports.
c
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The demand for loanable funds curve slopes downward because the
A) expected rate of profit is related positively to the real interest rate. B) real interest rate is the opportunity cost of investment. C) price of bonds and stocks is not related to the real interest rate. D) higher the real interest rate, the lower the cost of investment. E) expected rate of profit is factor that "rewards" firms for their investment.
The excludability versus nonexcludability issue is
A. relevant to the issue of market failure. B. not relevant to the issue of market failure. C. relevant to the free-rider problem. D. a and c E. b and c
How does the open-economy IS-MP model incorporate net exports with a fixed exchange rate system?
What will be an ideal response?
The investment expenditures made by Macroville's power plant to reduce air polluting emissions result in a decrease in the national economy's net output for the year
Indicate whether the statement is true or false