Which of the Following Statements Is TRUE

question 18

Multiple Choice

Which of the following statements is TRUE?

• A) Free trade is beneficial only if your country is strong enough to stand up to foreign competition.
• B) Free trade is beneficial only if your competitor does not pay unreasonably low wages.
• C) Free trade is beneficial only if both countries have access to the same technology.
• D) Free trade is never beneficial for developing countries.
• E) Free trade can be beneficial to the economic welfare of all countries involved.

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Definitions:

Allowance Account

An account used to record reductions in the book value of accounts receivable due to potential future defaults on payments.

Doubtful Accounts

Doubtful accounts represent receivables that a company is uncertain to collect, typically categorized separately to reflect potential losses.

Cash Discount

A reduction in the invoice amount by the seller if the buyer pays their bill within a specified time frame, incentivizing prompt payment.

Retail Customers

Individuals who purchase goods and services for personal use from retailers, as opposed to wholesale customers.