Discuss why it is unlikely that a country would specialize in just one product, and support your explanation with an example.
What will be an ideal response?
Answers will vary but should include the idea of exposure to risk. Even with a marked comparative advantage over other countries, a country that specialized in just one product would be exposed to a great deal of risk. For example, if a country specialized only in soybean production, but an infestation or weather event destroyed the crop, then the country would have no other product to bring to market, and its economy would be devastated.
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Causation occurs when:
A) two variables tend to move in opposite directions. B) change in one variable is the reason for the change in another variable. C) two variables tend to move in the same direction. D) change in one variable does not cause any change in another variable.
In the strategic view of bargaining:
a. You want to improve your opponent's outside options b. You want to decrease your outside options c. Bargaining is of a prisoner's dilemma game d. Bargaining is of a game of 'chicken'