Explain the Concepts of Trade Creation and Trade Diversion

question 97

Essay

Explain the concepts of trade creation and trade diversion.Who are the winners and losers in each scenario?

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Definitions:

Matching Phenomenon

The tendency for individuals to seek out and form relationships with those who are similar to them in attractiveness and other traits.

Realistic Expectations

Reasonable and achievable anticipations about outcomes based on evidence and past experiences, free from over-optimism or excessive pessimism.

Attractiveness

A characteristic or set of characteristics that are perceived as appealing or desirable in others, often influenced by cultural and personal preferences.

EVLN Model

A model explaining the four reactions of employees to workplace dissatisfaction: Leaving, Speaking Out, Staying Faithful, and Ignoring.