Trade Between Countries

question 86

Multiple Choice

Trade between countries

• A)allows each country to consume at a point outside its production possibilities frontier.
• B)limits a country's ability to produce goods and services on its own.
• C)must benefit both countries equally; otherwise, trade is not mutually beneficial.
• D)can best be understood by examining the countries' absolute advantages.

---

Definitions:

Interest

The charge for borrowing money, typically expressed as a percentage of the amount borrowed, paid by the borrower to the lender.

Cash Flow Ratio

A financial metric that compares a company's operating cash flow to its current liabilities, indicating its ability to pay off its obligations with the cash it generates.

Operating Activities

Activities directly related to the business's primary operations, including cash flows from sales, expenses, and cost of goods sold.

Total Assets

The total of a company's assets, encompassing both short-term and long-term assets.