The law of comparative advantage suggests that
What will be an ideal response?
individuals, states, and nations can all benefit if they trade with others.
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Consider two individuals, Artie and Deena, who produce wind chimes and sun dials. Artie's and Deena's weekly productivity are shown in Table 3.4. Which of the following is TRUE?
A) Artie has a comparative advantage in producing wind chimes but not sun dials. B) Artie has a comparative advantage in producing sun dials but not wind chimes. C) Artie has a comparative advantage in producing both goods. D) Artie does not have a comparative advantage in producing either good.
The different effects of fiscal and monetary policy in an open economy with mobile capital hinges on their different effect on
A. price levels. B. interest rates. C. the money supply. D. real GDP.