When Two Countries Are Specializing and Trading with Each Other,the

question 130

Multiple Choice

When two countries are specializing and trading with each other,the gains from trade will tend to be greater when

• A)opportunity costs in the two countries are similar.
• B)there are economies of scale in production.
• C)prices rise in both countries.
• D)the production possibilities boundaries shift inward.
• E)comparative advantages are eliminated.

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