When Opportunity Costs Are Identical Between Two Countries for All

question 115

Multiple Choice

When opportunity costs are identical between two countries for all goods,

• A)there can be no gains from trade unless there are economies of scale in some of the products.
• B)international trade will be advantageous only to the country that has an absolute advantage in the production of some commodity.
• C)there will be gains from trade for both countries if one country has an absolute advantage in the production of some commodity.
• D)absolute advantages will determine the gains from trade.
• E)there will be absolute advantages from trade but no comparative advantages from trade.

---

Definitions:

Neolithic Revolution

Marks the transition from nomadic hunting and gathering lifestyles to settled farming and agriculture, leading to significant changes in human society and environment.

Consequences

The outcomes, effects, or results that naturally follow from an action or condition, often used in the context of discussing the aftermath of decisions.

Informal Economy

The part of an economy that is neither taxed nor monitored by any form of government, often characterized by cash transactions and unregulated employment.

Goods And Services

The products and activities offered by businesses to satisfy the needs and wants of consumers, where goods are tangible items and services are intangible experiences or tasks performed.