Why Are the Gains from Trade Often Difficult to Recognize

question 30

Multiple Choice

Why are the gains from trade often difficult to recognize?

• A) The United States does not keep accurate records of employment.
• B) The gains are spread out over a wide variety of goods and consumers.
• C) There are no gains from trade.
• D) The gains are in services, which are difficult to measure.

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Definitions:

Income

The extraction of financial value, repetitively over time, from working engagements or investment pursuits.

Income Elasticity

A measure of how much the demand for a good or service changes with a change in the consumer's income.

Per Capita

A statistical measure that represents the average per person of a particular indicator, such as income or GDP.

Disposable Income

The sum of funds households can allocate for expenditure and saving once income taxes are deducted.