Why Is Trade an Important Source of Economic Progress

question 128

Multiple Choice

Why is trade an important source of economic progress?

• A) It allows the trading partners to produce a larger joint output through specialization in the areas where they have a comparative advantage.
• B) It allows the trading partners to produce a larger joint output as the result of greater realization of cost reductions that accompany the adoption of mass production methods.
• C) It makes it possible to realize gains from the discovery and dissemination of innovative products and production processes.
• D) All of the above are correct.

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Definitions:

Syllogism

A form of reasoning in which a conclusion is drawn from two given or assumed propositions (premises); a common form of logical deduction.

Participants

Individuals who take part in something, especially in an experiment or study.

Decision Making

The cognitive process of selecting a course of action among several alternatives to achieve a desired outcome.

Reasoning

refers to the cognitive process of looking for reasons, engaging in logical thinking, and arriving at conclusions based on premises.