Assume That Spain Has a Comparative Advantage in Fish and Germany

question 196

Multiple Choice

Assume that Spain has a comparative advantage in fish and Germany has a comparative advantage in cars.What will happen if these two countries specialize and trade according to their comparative advantage

• A)All individuals in both countries will benefit.
• B)Spain will specialize in and export cars.
• C)Germany will produce more cars than fish in the absence of trade.
• D)Germany will produce more fish than cars in the absence of trade.

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Definitions:

Sequential Processing

Processing one aspect of a stimulus or problem at a time; generally used to process new information or to solve difficult problems.

Effortful Processing

A type of memory processing that requires attention and conscious effort in order to encode information.

Automatic Processing

Cognitive processing that occurs subconsciously and requires little to no attention or conscious effort.

Explicit Memory

Memory that requires intentional retrieval of past information and experiences.