Why Is Trade an Important Source of Economic Progress

question 128

Multiple Choice

Why is trade an important source of economic progress?

• A) It allows the trading partners to produce a larger joint output through specialization in the areas where they have a comparative advantage.
• B) It allows the trading partners to produce a larger joint output as the result of greater realization of cost reductions that accompany the adoption of mass production methods.
• C) It makes it possible to realize gains from the discovery and dissemination of innovative products and production processes.
• D) All of the above are correct.

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Definitions:

Differing Agendas

Situations where individuals or groups have objectives or priorities that do not align with one another.

Chief Executive Officer

The top executive in a corporation or institution, in charge of making significant business decisions and overseeing all operations.

Nonprofit Organization

An entity that operates for the public or societal benefit, rather than to earn profits for owners or shareholders.

Modify Existing Ideas

The process of adjusting, adapting, or changing current concepts or proposals to create new or improved outcomes.