Which of the Following Is True

question 62

Multiple Choice

Which of the following is true?

• A)​A nation cannot have a comparative advantage in the production of every good.
• B)​A nation cannot have an absolute advantage in the production of every good.
• C)​A nation can have a comparative advantage in the production of every good, but not an absolute advantage.
• D)​A nation can have a comparative advantage in the production of a good only if it also has an absolute advantage.

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Definitions:

Effective Annual Rate

The real return on an investment, accounting for the effect of compounding over a period.

Discount

A reduction to the usual price of goods or services, or in finance, the difference between the face value of a bond and its selling price.

Forego Discount

Choosing not to take advantage of early payment discounts offered by suppliers or creditors.

Costly Trade Credit

Refers to the high cost associated with the short-term financing obtained by buyers from suppliers when they choose to delay payment.