The law of comparative advantage explains why a nation will benefit from trade when
a. it exports more than it imports.
b. its trading partners are experiencing offsetting losses.
c. it exports goods for which it is a high-opportunity cost producer, while importing those for which it is a low-opportunity cost producer.
d. it exports goods for which it is a low-opportunity cost producer, while importing those for which it is a high-opportunity cost producer.
D
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Banks in Richland charge an interest rate of 4% for overnight loans to each other. How will this rate change if the central bank of Richland engages in open market operations to purchase bonds?
What will be an ideal response?
Entrepreneurs play a key role in which type of economy?
A) command economy B) centrally planned economy C) market economy D) all of the above
Arguments by regulators are often made that predatory pricing, with its attendant temporary price-cutting below costs, is an attempt to eliminate rivals with the intent of raising prices after the competition has left
Critically evaluate this argument.
Capital inflows that take the form of direct investment may be particularly beneficial if they bring new technologies, new management techniques, and new ideas to the host country
Indicate whether the statement is true or false