In a Two-Country,two-Commodity Framework,when One Country Has an Absolute Advantage

question 130

Multiple Choice

In a two-country,two-commodity framework,when one country has an absolute advantage in the production of both commodities,_____.

• A)autarky is always preferred to trade
• B)differences in the opportunity cost of production between the two countries ensure that specialization and trade result in mutual gains
• C)the country with the lowest opportunity cost of production is the least competitive in international markets
• D)the countries gain from mutual trade as long as tastes differ across countries
• E)the countries gain from specialization and exchange as long as they are the same size

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Definitions:

Cork Cambium

A layer of tissue in plants that produces cork (phellem) cells for protection and waterproofing.

Lignin

A complex organic polymer found in the cell walls of many plants, making them rigid and woody and providing structural support.

Sclerenchyma

In plants, simple tissue composed of cells that die when mature; their tough walls structurally support plant parts. Includes fibers, sclereids.

Ground Tissue

A plant tissue system that makes up the bulk of most plants, involved in photosynthesis, storage, and support; includes parenchyma, collenchyma, and sclerenchyma cells.