Suppose Haiti Has an Absolute Advantage Over Other Countries in Producing

question 308

Multiple Choice

Suppose Haiti has an absolute advantage over other countries in producing oranges,but other countries have a comparative advantage over Haiti in producing oranges.If trade in oranges is allowed,Haiti

• A) will import oranges.
• B) will export oranges.
• C) will either export oranges or export oranges, but it is not clear from the given information.
• D) would have nothing to gain either from exporting or importing oranges.

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Definitions:

GDP Deflator

A gauge for pricing of all new, native-produced, conclusive goods and services within an economy, applied to revise nominal GDP in order to compute real GDP.

Real GDP

Gross Domestic Product adjusted for inflation, measuring the value of goods and services produced by a country in a specific period in real terms.

Percentage Change

A mathematical calculation that determines the degree of change over time as a proportion of the original value, often used to measure growth or decline in economic data.

Real GDP

The calculation of a nation's economic production accounting for variations in prices, representing the actual value of all goods and services generated.