Which of the Following Statements Is True

question 119

Multiple Choice

Which of the following statements is true?

• A)Absolute advantage implies comparative advantage.
• B)Comparative advantage does not require absolute advantage.
• C)Absolute advantage requires comparative advantage.
• D)Comparative advantage requires absolute advantage.

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Definitions:

Ratification

The principal’s approval of an unauthorized act performed by an agent or by one who has no authority to act as an agent. Also, an approval of a contract made by a minor after reaching maturity.

Contractual Obligation

A legal duty that arises out of a contract, requiring a party to either perform or refrain from performing certain acts.

Exculpatory Agreement

A clause that says one of the parties to a contract, generally the one who wrote the contract, is not liable for any economic loss or physical injury, even if that party caused the loss or injury.

Exculpatory Clause

A clause in a contract that releases a party from liability for his or her wrongful acts. These clauses are not favored by law.