Suppose Country X Currently Produces Widgets.Then It

question 76

Multiple Choice

Suppose country X currently produces widgets.Then it
Establishes a preferential trading agreement with country Y.
Following the formation of the PTA, country X no longer produces
Widgets and imports widgets from country Y.What has occurred?

• A)There is trade diversion and a welfare gain for both country X and country Y.
• B)There is trade diversion, a welfare gain for country Y, and a welfare loss for country X.
• C)There is trade creation and a welfare gain for both country X and country Y.
• D)There is trade creation, a welfare gain for country Y, and a welfare loss for country X.

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Definitions:

Anticlines And Synclines

Geological features where rock layers are folded upwards to form ridges (anticlines) and downwards to form troughs (synclines), often due to tectonic forces.

Thrust Faults

A type of fault where rocks on one side are pushed up and over rocks on the other, often associated with mountain building.

Volcanic Center

A location on the Earth's surface that has been the site of multiple volcanic eruptions and activities over a long period.

Energy Resource

Natural resources that can be converted into energy forms usable by humans, such as oil, coal, solar, and wind.