Comparative Advantage Is Based on

question 52

Multiple Choice

Comparative advantage is based on

• A) comparing physical endowments, such as mineral resources, of two countries.
• B) two countries producing the same good.
• C) differences in opportunity costs between two countries.
• D) one country being able to out-produce another country in some good.
• E) comparing the capital accumulations of two countries.

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Definitions:

Receivables

Amounts owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Accounts Receivable Turnover

A financial ratio that measures how effectively a company collects on its credit sales by dividing total credit sales by the average accounts receivable.

Current Asset

An asset that is expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business.

Eighteen Months

A period of time equal to one and a half years.