Of the Following Statements About Trade,which Is NOT True

question 28

Multiple Choice

Of the following statements about trade,which is NOT true?

• A) Trade generates jobs in both export and import sectors of an economy.
• B) The gains from open trade are always greater than the losses.
• C) Open trade and investment does create winners and losers.
• D) Trade does not influence culture.
• E) Trade is the two-way flow of exports and imports of goods and services.

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Definitions:

Required Reserve Ratio

The percentage of deposits that banks must hold in reserve and not lend out to ensure liquidity.

Transfer Payments

Financial distributions by the government to individuals without any expectation of a good or service being provided in return.

Government Securities

Financial instruments issued by a government to borrow money from investors with a promise to pay back with interest.

Recessionary Gap

A situation in macroeconomics where the actual output of an economy is less than its potential output, leading to unemployment and underutilized resources.