Which of the Following Statements Is True

question 147

Multiple Choice

Which of the following statements is true?

• A) Free trade will benefit all workers in a nation equally.
• B) As a result of specialization some workers will be displaced and hence, harmed by free trade.
• C) Free trade leads to lower wages for all workers in both nations.
• D) Specialization will result in a decline in an industry and none of those workers will be able to find other jobs.

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Definitions:

Factor Markets

Markets where services of the factors of production (land, labor, capital) are bought and sold.

Maximize Profit

The process or strategy undertaken by businesses to increase their net earnings and achieve the highest possible profit margin.

Workers

Individuals engaged in a physical or mental activity with the aim of producing goods or providing services in exchange for wages.

Debbie's Bakery

An hypothetical or specific establishment that specializes in the preparation and sale of baked goods such as bread, pies, and cakes.