Suppose That the Home Country in the Two­sector

question 45

Multiple Choice

Suppose that the Home country in the two­sector
(manufacturing and agriculture) specific­factors model
Has a comparative advantage in manufactured output.
What is the effect on the return of capital after trade
Occurs?

• A)The return on capital increases.
• B)The return on capital decreases.
• C)The return on capital does not change.
• D)The effect cannot be determined.

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Definitions:

Reliable Accounting

Accounting practices that are consistently accurate and trustworthy, providing a true and fair view of an organization's financial situation.

Internal Control Principle

Guidelines and procedures designed to safeguard assets, enhance the accuracy and reliability of accounting records, and ensure compliance with laws and regulations.

Adequate Records

Comprehensive and accurate documentation of financial transactions necessary for accounting and tax compliance.

Payee

In a monetary transaction, the recipient of the payment.