The principle of comparative advantage indicates that mutually beneficial international trade can take place only when
A. transportation costs are almost zero.
B. tariffs are eliminated.
C. a country can produce more of some product than other nations can.
D. relative costs of production differ between nations.
Answer: D
You might also like to view...
How do the deadweight losses of a tariff differ when the domestic industry is perfectly competitive from when it is a monopoly?
a. They are the same. b. Deadweight losses are larger for a perfectly competitive industry than for a monopoly. c. Deadweight losses are larger for a monopoly than for a perfectly competitive industry. d. It is not possible to compare deadweight losses of a monopoly with those of a perfectly competitive industry.
In the long run, if we observe firms in a competitive market earning economic profits, we know that this market is in long-run equilibrium
a. True b. False Indicate whether the statement is true or false