The Dominican Republic Has a Comparative Advantage in the Production

question 109

Multiple Choice

The Dominican Republic has a comparative advantage in the production of tobacco, and Panama has a comparative advantage in the production of oranges. If both countries specialize based on the theory of comparative advantage

• A) only the production of tobacco will increase.
• B) only the production of both goods will increase.
• C) only the consumption of both goods will increase.
• D) the production and consumption of both goods will increase.

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Definitions:

HSA

A Health Savings Account (HSA) is a tax-advantaged savings account designed for individuals with high-deductible health plans to save for medical expenses.

Moving Expenses

are costs associated with relocating for work which, under certain circumstances, may be deducted from taxable income.

Deductibility

The ability of a particular expense to be subtracted from gross income, thereby reducing taxable income.

For AGI Deduction

Deductions that are subtracted from gross income to arrive at adjusted gross income, potentially lowering taxable income.