Suppose rice can be produced in China at a lower cost than in Thailand, while tuna can be produced in Thailand at a lower cost than in China. International competition will
a. destroy the rice market in both countries
b. drive China to specialize in rice and Thailand to specialize in tuna
c. drive Thailand to specialize in rice and China to specialize in tuna
d. cause both countries to reject international specialization
e. result in lower total output of rice and tuna
B
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Jerome has a "C" average in his philosophy course and a "B" average in his economics course. He decides to study an extra hour for his philosophy exam. This is an example of
A) ceteris paribus. B) caveat emptor. C) using assumptions to simplify. D) thinking at the margin.
When the price of one pen is $1, 50 notebooks are demanded. When the price per pen increases to $5, the number of notebooks demanded decreases to 30. What is the cross-price elasticity of demand between the two goods using the arc method?
A) 0.1 B) -0.375 C) 3 D) -3