What Limits the Terms of Trade That a Country Would

question 113

Multiple Choice

What limits the terms of trade that a country would find acceptable?

• A) The country's opportunity costs of production.
• B) Whether the country has an absolute advantage at producing a good.
• C) How much the country values the good for which it is trading.
• D) When the country has a comparative advantage at producing both goods.

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Definitions:

Consensus

A general agreement or unified opinion among a group of people, often achieved through discussion and collaboration.

Consistency

The quality of always acting or behaving in the same way, leading to predictable and reliable outcomes or performances.

Conditioned Response

A learned reaction to a specific stimulus that occurs after repeated exposure to that stimulus.

Neutral Stimulus

A stimulus that initially produces no specific response other than focusing attention; in conditioning, it becomes associated with an unconditioned stimulus.