Comparative Advantage Explains Why a Nation Will Benefit from Trade

question 4

Multiple Choice

Comparative advantage explains why a nation will benefit from trade when:

• A) it exports more than it imports.
• B) its trading partners are experiencing offsetting losses.
• C) it exports goods for which it is a high-opportunity cost producer, while importing those for which it is a low-opportunity cost producer.
• D) it exports goods for which it is a low-opportunity cost producer, while importing those for which it is a high-opportunity cost producer.

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Definitions:

Percent

A mathematical term representing a part per hundred, used to describe proportions or ratios.

Helmets

Protective headgear worn to reduce the risk of injury, especially in sports, construction, and transportation.

Opportunistic

Taking advantage of situations with little regard for principles or consequences, often to gain personal benefits or advantages.

Cinema

A movie theater where films are shown for public entertainment or the art of filmmaking itself.