Under Which of the Following Conditions Will the Principle of Comparative

question 18

Multiple Choice

Under which of the following conditions will the principle of comparative advantage be most likely to produce a situation where the price of a good is equalized among all countries?

• A) export subsidies
• B) free trade and competition
• C) quotas
• D) tariffs
• E) high transportation costs

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Definitions:

Solution

The number or collection of numbers that fulfill a given equation, inequality, or a set of equations.

Inequality

A mathematical statement that suggests a non-equivalence between two values or expressions.

Absolute Value

The distance of a number from zero on the number line, without considering direction.

Inequality

A mathematical expression that shows the relationship between two values that are not equal, using symbols such as <, >, ≤, and ≥.