Assume That Initially Country a Exchanges Three Barrels of Oil

question 56

Multiple Choice

Assume that initially country A exchanges three barrels of oil for one ton of steel from country B. Later the arrangement changes to four barrels of oil for one ton of steel. This indicates that:

• A) the terms of trade for country B have improved.
• B) country A has a comparative advantage in the production of steel.
• C) the relative price of steel in terms of oil has fallen.
• D) the terms of trade for country A have improved.
• E) country B has an absolute advantage in the production of oil.

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Definitions:

Medical Care

Services provided by healthcare professionals to prevent, diagnose, and treat illnesses, injuries, and other physical and mental impairments.

Medical Insurance

A form of insurance that covers the whole or part of the risk of a person incurring medical expenses.

Transductive Reasoning

A type of thinking typical in early childhood where children make inferences from specific instances to other specific instances.

Intuitive

Relating to the ability to understand or know something without conscious reasoning; instinctive.