In the text, U.S. and Mexico specialize in the production of corn and oil, respectively. They trade and both end up with more corn and oil. How much each gains from trade depends on
a. who has the comparative advantage
b. who has the absolute advantage
c. how efficiently the U.S. and Mexico produce corn and oil
d. the import/export ratio
e. the price of oil in terms of corn
E
Economics
You might also like to view...
Which of the following is an example of an unintended consequence?
a. government sponsored ad campaigns that lead to an increase in vaccinations b. rent controls that lead to a decline in the quality of rental properties c. higher property taxes that allow for better public schools d. increased airport security measures that result in safer travel
Economics
Which of the following terms best describes the situation in which a country is running both a trade and a budget deficit?
a. neutral deficits b. twin deficits c. Ricardian equivalence d. balance of trade
Economics