Which of the Following Has Been Confirmed by Empirical Tests

question 13

Multiple Choice

Which of the following has been confirmed by empirical tests of the Ricardian model?

• A) All predictions of the model for a multi-product, multi-country world are highly unrealistic.
• B) The existence of nontraded goods results in a high degree of specialization among countries.
• C) International trade has no impact on income distribution.
• D) The unimportance of economies of scale as a cause of trade.
• E) Companies tend to export goods in which they have a relatively high level of productivity.

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Definitions:

Leveraged Buyout

An acquisition of a company, primarily funded by borrowed money, where the assets of the company being acquired and those of the acquiring company are used as collateral.

Proxy Contest

An event where two or more competing parties seek to collect enough shareholder votes to control the company's board of directors.

Asset Purchase

The buying of a company's assets instead of its stock, often to acquire specific items rather than taking over the business entirely.

Leveraged Buyout

An acquisition where the buyer uses a significant amount of borrowed money to finance the purchase of a company, often using the assets of the company being bought as collateral for the loans.