Which of the Following Is True

question 41

Multiple Choice

Which of the following is true?

• A)In the HO model complete specialization in the production of exports is a likely outcome of international trade.
• B)In the classical model, complete specialization seldom occurs due to the assumption of increasing opportunity costs.
• C)Complete specialization is more likely if opportunity costs change little as the production point moves closer to either axis.
• D)All of the above are true.

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Definitions:

Inferior Good

An item whose demand falls when consumer income rises, contrasting with normal goods where demand increases with income.

Technological Advancement

The process of developing and applying new technologies to improve products, processes, or services.

Equilibrium Quantity

When the market is at equilibrium, the supply of goods or services is identical to the demand at that price.

Coffee-Bean Pickers

Individuals engaged in the agricultural activity of harvesting coffee beans from plants.