If Two Countries Produce Both Wheat and Sugar and One

question 53

True/False

If two countries produce both wheat and sugar and one country has the comparative advantage in producing wheat then the other country must have the comparative advantage producing sugar.

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Definitions:

Interest Rate

The component of a loan that accrues interest to the borrower's account, conventionally shown as an annual percentage of the loan outstanding.

Consumption

The use of goods and services by households or individuals for personal satisfaction or needs.

Interest Rate

A cost, depicted as a proportion of the borrowed sum, which a lender demands from a borrower in exchange for asset usage.

Rational Behavior

A theory in economics suggesting that individuals make decisions based on maximizing utility and firms aim to maximize profits.