Which of the Following Statements Is True of Countertrade

question 23

Multiple Choice

Which of the following statements is true of countertrade?

• A) Countertrade is practiced by countries when there is a lack of hard currency.
• B) Countertrade involves products whose prices on world markets tend to remain steady.
• C) Countertrade usually involves industrial products and computer softwares.
• D) Hedging risk in countertrade is prohibited.

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Definitions:

Property Rights

Legal rights to possess, use, and dispose of assets such as land, buildings, or intellectual property.

Efficient Allocation

Efficient allocation involves the distribution of resources in a manner that maximizes productivity and utility, often considered optimal in economic theory.

Government Failure

Situations where government interventions in the market lead to inefficiencies, misallocation of resources, or failure to achieve desired social or economic outcomes.

Market Failure

A situation in which the allocation of goods and services by a free market is not efficient, often justifying government intervention.