When Specialization According to Comparative Advantage Also Makes Economies of Scale

question 22

Multiple Choice

When specialization according to comparative advantage also makes economies of scale possible,

• A)trade is not beneficial to the country that has the absolute advantage in both goods.
• B)the production possibilities boundaries of all trading countries will shift inward.
• C)there will be additional gains from trade.
• D)costs will rise in all trading countries.
• E)it will be beneficial for all trading countries to impose tariffs.

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Definitions:

Egocentrism

A cognitive characteristic where an individual has difficulty understanding or acknowledging a perspective other than their own.

Narcissism

A personality trait characterized by an exaggerated sense of self-importance, need for admiration, and lack of empathy for others.

Disparity

A great difference or inequality between two or more things, often leading to an unfair situation.

Preoperational

The stage in Jean Piaget's theory of cognitive development where children (aged 2 to 7) begin to engage in symbolic play and struggle with logic and taking the perspective of others.