Given That Countries a and B Each Specialize in the Production

question 42

Multiple Choice

Given that countries A and B each specialize in the production of one good and voluntarily
Trade it for the other country's good, then

• A) only country A can experience positive gains from trade.
• B) only country B can experience positive gains from trade.
• C) both countries can experience positive gains from trade.
• D) both countries experience negative gains from trade.

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Definitions:

Sherman Antitrust Act

A landmark federal statute in the United States passed in 1890 aimed at promoting economic competition by prohibiting monopolies, cartels, and other forms of anticompetitive business practices.

Monopolies and Trusts

Economic structures or arrangements where a single entity or a group controls a significant portion of market share, limiting competition.

Yellow Dog Contracts

Employment agreements where workers pledge not to join or support a labor union during their period of employment, illegal in many jurisdictions.

National Industrial Recovery Act

A 1933 U.S. legislation aimed at boosting economic growth during the Great Depression through industrial codes of fair competition and promoting the establishment of labor standards.