In Terms of Static Economic Analysis, If a Customs Union

question 14

Multiple Choice

In terms of static economic analysis, if a customs union results in a small amount of trade creation relative to trade diversion, world welfare

• A) increases.
• B) decreases.
• C) either increases or decreases.
• D) neither increases nor decreases.

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Definitions:

Net Income

Net Income is the total earnings of a company after deducting all expenses, taxes, and costs, representing the profit earned during a specific period.

P/E Ratio

The Price-to-Earnings ratio compares a company's current share price to its per-share earnings, providing insight into how much investors are willing to pay per dollar of earnings.

Market-To-Book Ratio

A ratio used to compare a company's market value to its book value, indicating investors' expectations of the company's future growth prospects.

Earnings Per Share

A company's net profit divided by the number of its outstanding shares, indicating the profitability of a company on a per-share basis.