The Free Trade Theories of Specialization Primarily Assume That ________

question 56

Multiple Choice

The free trade theories of specialization primarily assume that ________.

• A)specialization leads to unemployment, but production gains compensate for job losses
• B)resources can move internationally from the production of one good to another
• C)resources can move domestically from the production of one good to another
• D)countries have objectives other than economic efficiency

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Definitions:

Advantage

A condition or circumstance that puts a company or situation in a favorable or superior position compared to competitors.

Transfer Price

The price at which divisions of a company transact with each other, such as the exchange of supplies or labor between departments.

Market Price

The current price at which an asset or service can be bought or sold.

Variable Cost

Expenses that change in proportion to the production or sales figures, like labor and materials.