Trade Diversion Reduces Worldwide Efficiency,because

question 108

Multiple Choice

Trade diversion reduces worldwide efficiency,because:

• A)production is diverted to the country with the comparative advantage.
• B)production is diverted from the country with the comparative advantage.
• C)unnecessary trade restrictions are created in the economies.
• D)consumption is diverted to the country having inadequate demand.
• E)the cost of transshipment of the goods increases thus raising their prices in the world market.

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Definitions:

Inferiority Complex

A psychological condition where a person feels inadequate and deficient, often resulting in a lack of self-esteem and overcompensation in other areas.

Adler

Alfred Adler was an Austrian medical doctor and psychotherapist, founder of the school of individual psychology, known for his concepts of the inferiority complex and striving for superiority.

Conditioned Stimulus

A previously neutral stimulus that, after becoming associated with an unconditioned stimulus, eventually comes to trigger a conditioned response.

Neutral Stimulus

A stimulus that initially produces no specific response until it is paired with an unconditioned stimulus in classical conditioning.