Two countries will choose to specialize and trade only if:
A. the terms of trade fall between their opportunity costs for producing the goods on their own.
B. the opportunity costs are the same for the two nations.
C. the opportunity costs are astronomically high for producing the goods on their own.
D. one country possesses the absolute advantage in both goods, but the comparative advantage in only one good.
A. the terms of trade fall between their opportunity costs for producing the goods on their own.
You might also like to view...
When a firm has little ability to influence market prices it is said to be in
a. a thin market. b. a power market. c. a competitive market. d. a strategic market.
The demand for money increases and the demand for money curve shifts rightward if
A) the real interest rate increases. B) the inflation rate increases. C) the nominal interest rate increases. D) the price level falls. E) real GDP increases.