Comparative advantage indicates that:
A. specialization and exchange will permit trading partners to maximize their joint consumption.
B. a nation can gain from trade only if it is not at an absolute disadvantage in producing all goods.
C. a nation can gain from trade only when its trading partners are not low-wage countries.
D. countries should export products for which they are high-opportunity cost producers.
Answer: A
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By the accelerator hypothesis, if a firm's actual sales jump in one period to a higher maintained level, that firm's replacement investment
A) also jumps in one period to a higher maintained level. B) gradually drifts upward to a higher maintained level. C) jumps upward and then falls back to zero. D) jumps upward and then falls back part of the way.
Assume that $1 equals 100 yen (¥). A Japanese visitor to the United States wants to pay her $400 hotel bill. How many yen should she exchange in order to have enough dollars to pay the bill?
A) ¥4 B) ¥40 C) ¥4,000 D) ¥40,000