Ricardo's Model of Comparative Advantage Assumed All of the Following

question 142

Multiple Choice

Ricardo's model of comparative advantage assumed all of the following except:

• A) Trade is balanced,thus ruling out flows of money between nations
• B) Firms make production decisions in an attempt to maximize profits
• C) Free trade occurs between nations
• D) Labor is immobile within a country,but is incapable of moving between countries

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Definitions:

Iris

The colored part of the eye surrounding the pupil, controlling light levels entering the eye by adjusting the pupil size.

Ciliary Body

A ring of tissue behind the iris of the eye, containing muscle that controls the shape of the lens for focusing and produces aqueous humor.

Hyperopia

A vision condition where distant objects are seen more clearly than near objects, often referred to as farsightedness.

Farsightedness

A common vision condition where distant objects are seen more clearly than close ones, also known as hyperopia.