Suppose the US and Mexico Both Produce Semiconductors and Auto

question 21

Multiple Choice

Suppose the US and Mexico both produce semiconductors and auto parts and the US has a comparative advantage in semiconductors while Mexico has a comparative advantage in auto parts.If the US exports semiconductors to Mexico and imports auto parts from Mexico,

• A) both countries, as a whole, will be better off.
• B) all individuals in both countries will be better off.
• C) both countries, as a whole, will be worse off.
• D) all individuals in both countries will be worse off.

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Definitions:

Chichén Itzá

A large pre-Columbian archaeological site built by the Maya civilization located in the Yucatán Peninsula of Mexico, famous for its central pyramid, known as El Castillo.

South America

A continent located in the Western Hemisphere, mostly in the Southern Hemisphere, with a diversity of climates, cultures, and wildlife.

Chavín de Huántar

An archaeological site in Peru, representing a major center of the Chavín culture, known for its monumental architecture and stone sculptures.

Mother Culture

A concept in anthropology referring to a culture that influences and gives rise to other cultures through diffusion or conquest.