In a Situation of Free Trade

question 6

Multiple Choice

In a situation of free trade,

• A)countries with comparative advantage will export more than countries with comparative disadvantage import.
• B)the total quantity of an item exported will be greater than the total quantity imported.
• C)importing countries will always produce some good, so that total quantity imported is less than total quantity exported.
• D)the total quantity of an item exported will equal the total quantity imported.

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Definitions:

Accounts Payable Turnover

A financial ratio that measures the rate at which a company pays off its suppliers by comparing net purchases to average accounts payable during a period.

Accounts Receivable Period

The Accounts Receivable Period is the average number of days it takes for a business to receive payments from its customers for goods or services sold on credit.

Accounts Receivable

Receivables from customers for goods or services provided but not yet compensated.

Effective Annual Interest Rate

The interest rate on a loan or financial product restated from the nominal rate as an annual rate that reflects compounding over a given period.