If Two Countries Begin Trade and Both Produce a Product

question 3

Multiple Choice

If two countries begin trade and both produce a product subject to internal economies of scale, then the country with the ________ rate of production will ________ production until it controls ________ of the market.

• A) higher; increase; 50%
• B) higher; increase; 100%
• C) higher; decrease; 0%
• D) lower; increase; 50%
• E) lower; increase; 100%

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Definitions:

Defective Incorporation

A situation where errors or omissions occur during the incorporation process of a company, potentially affecting its legal status or liability.

Involuntary Dissolution

The legal termination of a corporation's existence without the consent of the corporation, often initiated by a government authority.

Personally Liable

A situation where an individual is responsible for a debt or obligation from their own assets, rather than the liability being limited to business or corporate assets.

Public Corporation

A company whose shares are traded freely on a stock exchange or markets, owned by public shareholders, and subjected to regulatory reporting requirements.