If Country a Has an Absolute Advantage Over Country B

question 73

Multiple Choice

If Country A has an absolute advantage over Country B in the production of every commodity,

• A) mutual gains from trade between Country A and Country B would be impossible.
• B) Country B would be able to gain from trade but not country A.
• C) the joint output of the two countries could not be increased through specialization and exchange.
• D) mutual gains from trade would still be possible.

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Definitions:

Mandatory Items

Requirements or objects that are obligatory and must be included or complied with.

Bargaining Session

A scheduled meeting between parties, such as employers and employees, to negotiate terms and conditions, often related to employment or trade agreements.

Contract Negotiations

The process of discussing terms and details to reach a mutual agreement in a contract, often involving aspects like salary, work conditions, and other employment terms.

Congress of Industrial Organizations

A federation of unions that organized workers in industrial unions in the United States and Canada from 1935 to 1955, when it merged with the American Federation of Labor.