What are the benefits and costs to a nation that participates in international trade? Do the benefits outweigh the costs or do the costs outweigh the benefits?
The benefits to a nation of specializing and trading with other nations along the lines of comparative advantage are the higher average absolute standards of living its people are able to enjoy. Prices are generally lower and there are a wider variety of more and higher quality products to consume. The costs to a nation include the loss of some businesses and some jobs. The evidence is clear that the benefits far outweigh the costs for a nation. This is why so many nations want to increase their participation in the global economy.
You might also like to view...
In the figure above, the initial demand curve is D0. There are no rent ceilings nor rent floors. The equilibrium monthly rent is
A) $100 per month. B) $200 per month. C) $300 per month. D) $400 per month.
Which of the following statements regarding futures is true?
A) trading futures contracts on agricultural and mineral commodities makes up a majority of all trading. B) trading in financial futures involves more transactions than trading in commodity futures. C) futures trading is allowed only for financial assets. D) futures trading is allowed only for commodities.