In the Ricardian Model, Wages Are Equal Across Industries Because

question 130

Multiple Choice

In the Ricardian model, wages are equal across industries because:

• A) employers care for their workers.
• B) workers prefer to work in exporting industries.
• C) workers are freely mobile between industries.
• D) workers are freely mobile between countries.

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Definitions:

Long-Run Economic Profits

Profits earned by a firm when all resources are adjusted to their long-term optimal level, indicating the firm is in equilibrium and cannot earn higher profits by altering production.

Free Entry And Exit

A situation in a market where firms can enter and leave the industry without facing significant barriers or costs, promoting competition.

Industry

A sector of the economy that involves the production and distribution of goods or services within a particular field.

Monopolistically Competitive Industry

Describes a market structure where many companies sell products that are similar but not identical, allowing for significant differentiation and some pricing power.