In the Trade Between a Small and a Large Nation

question 2

Multiple Choice

In the trade between a small and a large nation:

• A)the large nation is likely to receive all of the gains from trade
• B)the small nation is likely to receive all of the gains from trade
• C)the gains from trade are likely to be equally shared
• D)we cannot say

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Definitions:

P-Value

The odds of encountering test findings at least as extreme as the observed ones, given that the null hypothesis is accurate.

Hypothesis Testing

A statistical method that uses sample data to evaluate a hypothesis about a population parameter, leading to a decision to accept or reject the hypothesis.

Test Statistic

A numerical value calculated from a sample of data used in statistical testing to determine whether to reject the null hypothesis.

T-Distribution

A probability distribution used in statistics, especially in scenarios with small sample sizes, that is symmetric, bell-shaped, and slightly thicker and longer-tailed than the normal distribution.