If There Is No Comparative Advantage in the Production of Either

question 109

Multiple Choice

If there is no comparative advantage in the production of either of the two goods produced by countries 1 and 2,then

• A) the benefits resulting from trade between the two countries are increased.
• B) there are no gains from specialization and trade between the two countries.
• C) one country must be more productive in producing all goods than the other.
• D) each country should specialize in the production of a particular good.
• E) none of the above

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Definitions:

SEC

The Securities and Exchange Commission, a U.S. federal agency that oversees and regulates the securities industry and enforces securities laws.

Howey Test

A test created by the Supreme Court to determine whether a transaction qualifies as an "investment contract" and is therefore subject to securities laws.

Security Exists

Indicates that a financial security, such as a stock or bond, is issued and available for trading or investment.

Inside Information

Confidential or non-public information about a company or its operations that could be used for trading its public securities and is considered illegal when used for insider trading.