Domestic Producers of a Good Become Better Off,and Domestic Consumers

question 259

Multiple Choice

Domestic producers of a good become better off,and domestic consumers of a good become worse off,when a country begins allowing international trade in that good and

• A)the country becomes an importer of the good as a result.
• B)the world price exceeds the domestic price of the good that prevailed before international trade was allowed.
• C)other countries have a comparative advantage,relative to the country in question,in producing the good.
• D)total surplus does not change as a result.

---

Definitions:

Statement of Cash Flows

A financial document that provides a summary of the cash inflows and outflows for a company over a specific period of time, showing how it raises and spends money.

Operating Activity

Business actions involving the day-to-day operations that generate revenue and incur expenses in the production of goods or services.

Investing Activity

Transactions involving the purchase and sale of long-term assets and investments, part of a company's cash flow activities.

Financing Activity

Transactions that result in changes in the size and composition of the equity capital or borrowings of a company.