Which of the Following Statements Is FALSE

question 111

Multiple Choice

Which of the following statements is FALSE?

• A) International trade restrictions limit specialization and the division of labor.
• B) International trade restrictions reduce the volume of trade and the gains from trade.
• C) International trade restrictions cause nations to produce inside their production possibilities frontier.
• D) International trade restrictions result in a country producing some of the product of its comparative disadvantage.

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Definitions:

Net Income

The amount of money a business keeps as profit after all expenditures, taxes, and costs are deducted from its aggregate revenue.

Preferred Dividends

Dividends that are allocated and paid to preferred shareholders before any dividends can be issued to common shareholders.

Operating Expenses

Costs that a business incurs through its normal business operations, excluding cost of goods sold.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials, labor, and manufacturing overhead.