With Economies of Scale and Decreasing Unit Costs,a Country Has

question 17

Multiple Choice

With economies of scale and decreasing unit costs,a country has the incentive to:

• A) Specialize completely in the product of its comparative advantage
• B) Specialize partially in the product of its comparative advantage
• C) Specialize completely in the product of its comparative disadvantage
• D) Specialize partially in the product of its comparative disadvantage

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Definitions:

Exports

Goods or services sold by a country to buyers in another country.

Imports

Products or services imported from foreign countries for the purpose of selling.

Trade Deficit

A situation where a country's imports exceed its exports, indicating that it is buying more goods and services from abroad than it is selling.

Exports

Goods or services sold by a country to buyers in other countries, contributing to the exporting country's gross domestic product.