In a Two-Product, Two-Country World, International Trade Can Lead to Increases

question 29

Multiple Choice

In a two-product, two-country world, international trade can lead to increases in

• A) consumer welfare only if output of both products is increased.
• B) output of both products and consumer welfare in both countries.
• C) total production of both products but not consumer welfare in both countries.
• D) consumer welfare in both countries but not total production of both products.
• E) prices of both goods in both countries.

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Definitions:

Increased Efficiency

Enhancements in productivity and performance, often achieved through improved processes or technologies, leading to reduced costs and increased outputs.

Cash Flow

The total amount of money being transferred into and out of a business, especially considered when assessing liquidity and financial stability.

Operating Activities

The day-to-day actions that are involved in running a business, typically involving production, sales, and delivery of a company's product or service.

Dividends Per Share

The amount of dividend a company pays out to each shareholder for each share they own, typically expressed on an annual basis.