Small Countries Might Produce More of a Particular Good Than

question 27

Multiple Choice

Small countries might produce more of a particular good than their domestic citizens can consume

• A)if they are willing to take a loss on the goods produced.
• B)if there are increasing returns to scale and export of the surplus is possible.
• C)when arbitrage is possible.
• D)if they are producing seasonal products.

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Definitions:

Times Interest Earned Ratio

A debt management ratio indicating the degree of risk to lenders that a company will default on its interest payments. Also called interest coverage ratio.

Return on Sales Ratio

A measure of a company's operational efficiency, calculated by dividing operating profit by net sales.

Return on Total Assets

A profitability ratio that measures the net income produced by total assets during a period by comparing net income to the average total assets.

Ratio

A relationship of two quantities or numbers, one divided by the other.