Which Trade Pattern Is BEST Explained by Increasing Returns

question 67

Multiple Choice

Which trade pattern is BEST explained by increasing returns?

• A)Honduras exports bananas to the United States,and the United States exports airplanes to Honduras.
• B)Pakistan exports clothing to the United States,and the United States exports airplanes to Pakistan.
• C)Japan exports cars to the United States,and the United States exports airplanes to Japan.
• D)Mexico exports beef to the United States,and the United States exports airplanes to Mexico.

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Definitions:

Employment

A state of having a paid job or occupation, contributing to an economy's workforce.

Anticipated Inflation

Inflation that is expected to occur in the future, as predicted by current economic indicators and analysis.

Unanticipated Inflation

Inflation that occurs when the actual rate is not what was expected, causing uncertainty and potential issues for businesses and consumers.

Nominal Interest Rate

The rate of interest charged on loans or paid on savings before adjusting for inflation, reflecting the face value rate.