If Country a Can Produce Both Goods X and Y

question 86

Multiple Choice

If country A can produce both goods X and Y more efficiently, that is, with smaller absolute amounts of resources, than can country B,

• A)mutually advantageous specialization and trade between A and B may still be possible.
• B)we can conclude that A is an industrially advanced economy and B is a developing economy.
• C)it will necessarily be advantageous for B to import both X and Y from A.
• D)then there is no possible basis for mutually advantageous specialization and trade between A and B.

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Definitions:

Credit Memos

Documents issued to a customer, indicating a reduction in the amount that the customer owes to the company.

Refund Receipts

Documents that confirm the return of funds to a customer for returned goods or overpayment.

Double Entry Accounting

An accounting method where every transaction affects at least two accounts, involving equal and opposite entries to ensure the accounting equation remains balanced.

Journal Entry

A record that represents a single financial transaction in the books of accounts.