If a Country Unilaterally Removes All Trade Restrictions

question 142

Multiple Choice

If a country unilaterally removes all trade restrictions,

• A)individual gains will tend to be larger in magnitude than individual losses.
• B)it will gain because all other countries' markets will be more open.
• C)it can prevent large adjustment costs.
• D)individual gains will tend to be smaller in magnitude than individual losses.
• E)everybody in the country will be better off.

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Definitions:

Contribution Margin

The difference between sales revenue and variable costs, representing the portion of sales that helps cover fixed costs.

Sales

The transactions or business activities related to selling goods or services, generating revenue for the company.

Production Facilities

Physical premises where goods are manufactured or produced, often encompassing buildings, machinery, and equipment.

Absorption Costing

An accounting method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed manufacturing overhead - in the cost of a product.