The Benefits to Trading Nations Based on Comparative Advantage Accrue

question 171

Multiple Choice

The benefits to trading nations based on comparative advantage accrue from

• A) specialization only.
• B) specialization and trading.
• C) trading only.
• D) protection of domestic industries.

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Definitions:

Downward-Sloping

A characteristic of a graph or curve that shows a decrease in one variable in response to an increase in another, commonly seen in demand curves.

Constant Elasticity

A condition in economics where the elasticity of one variable with respect to another is consistent across different levels of those variables.

Linear

Pertaining to something that is straight or sequential, often used to describe processes or relationships that have a constant rate of change.

Downward-Sloping

Describes a line on a graph that decreases in height as it moves from left to right, indicating a negative relationship between two variables.