If Two Countries Specialize in the Production of Goods in Which

question 131

True/False

If two countries specialize in the production of goods in which they have a comparative advantage, they can experience gains from trade.

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Definitions:

Foreign Bond

A bond issued in a domestic market by a foreign entity, in the domestic market's currency, as a means for the issuer to raise capital from investors in that market.

Sinking Funds

Reserves of money set aside by a corporation or government to repay a debt or bond issue at or before maturity.

Bondholder

An investor who owns bonds issued by a corporation or government, lending them money in exchange for periodic interest payments and the return of principal at maturity.

Issuer

An entity that issues or proposes to issue any security, or the entity on whose behalf the securities are issued.