The Relative Price of a Unit of Cloth in the Small

question 50

Multiple Choice

The relative price of a unit of cloth in the small isolated country of Moribundia is 5 units of food. When the central city, Mudhole, puts in an airstrip, the country is able to engage in trade. If the relative price of cloth in the outside world is 8 units of food, then Moribundia will export ________ and ________ factors used in the production of ________ will benefit.

• A) cloth; immobile; food
• B) food; mobile; food
• C) food; immobile; food
• D) cloth; immobile; cloth
• E) cloth; mobile; cloth

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Definitions:

Creditor Beneficiary

A third party that benefits from a contract, specifically where one party promises to pay a debt owed by another party to this third party.

Donee Beneficiary

A third party that benefits from a contract wherein the promisor agrees to give a gift or confer a benefit directly to the third party.

Assignment

The transfer of rights, duties, or property from one party to another, often used in the context of contracts and property law.

Developer

An individual or organization that undertakes the process of planning, designing, and constructing buildings or land into a new or altered use.