Which of the Following Provides the Foundation of the Case

question 116

Multiple Choice

Which of the following provides the foundation of the case for free trade?

• A) The law of diminishing marginal utility
• B) The anti-dumping argument
• C) The industrial diversity argument
• D) The theory of comparative advantage

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Definitions:

Marginal Revenue

The additional revenue that a firm receives from selling one more unit of a good or service.

Average Fixed Cost

The fixed costs of production (costs that do not vary with output) divided by the quantity of output produced.

Economic Profit

The disparity between the aggregate income and the sum of all expenses, encompassing both direct and indirect costs.

Weekly Operating Profits

The profit a company makes from its operations in a week, excluding non-operational revenues and expenses.