If a Country Allows Trade And, for a Certain Good

question 33

Multiple Choice

If a country allows trade and, for a certain good, the domestic price without trade is lower than the world price,

• A) the country will be an exporter of the good.
• B) the country will be an importer of the good.
• C) the country will be neither an exporter nor an importer of the good.
• D) Additional information is needed about demand to determine whether the country will be an exporter of the good, an importer of the good, or neither.

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Definitions:

Asset Turnover Ratio

A financial metric that measures the efficiency of a company's use of its assets to generate sales revenue.

Net Sales

Net Sales is the amount of sales generated by a company after deducting returns, allowances for damaged or missing goods, and discounts.

Accounts Receivables

Represents money owed to a company by its customers for goods or services delivered but not yet paid for.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year, calculated by dividing current assets by current liabilities.