The Principle of Comparative Advantage Implies That Trade

question 158

Multiple Choice

The principle of comparative advantage implies that trade

• A)decreases the level of world employment.
• B)shifts production possibilities curves inward.
• C)increases the amount of world production.
• D)decreases the amount of world production.
• E)decreases the amount of world consumption.

---

Definitions:

Standard Test Markets

Controlled market areas where new products or marketing campaigns are tested before a nationwide or international launch.

Cannibalization

A business phenomenon where a company’s new product eats into the sales of its existing products.

Business Analysis

The practice of identifying business needs and determining solutions to business problems through analysis and modification of processes.

Commercialization

The process of bringing a new product or service to the market, including production, distribution, marketing, and sales.