Suppose There Are Only Two Goods in the World, Corn

question 139

Multiple Choice

Suppose there are only two goods in the world, corn and shirts. If it is true that with its vast resources the United States could produce both more corn and more shirts than Mexico,

• A) Mexico will never have a comparative advantage and, thus, can never gain from trading with the United States.
• B) trade between the United States and Mexico will make the United States better off but will leave Mexico worse off unless the wage of workers in Mexico rises to equal that of American workers.
• C) total production of corn and shirts cannot be increased through specialization and trade.
• D) both countries will be able to gain from specialization and trade as long as relative costs of producing the two goods are different in Mexico than in the United States.

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Definitions:

Reactivity

The tendency of a substance to undergo chemical reaction, either by itself or with other materials, and release energy.

Objectivity

The principle of being impartial and unbiased, especially in research and reporting, aiming to minimize personal biases.

Participant Observation

A research method in social sciences where the researcher immerses themselves in a community or group to observe behaviors and interactions firsthand.

Going Native

A term used to describe the process whereby researchers or individuals adopt the culture and lifestyle of the communities they are studying, often losing objectivity.