Underlying the Theory of Comparative Advantage Are Assumptions Regarding

question 29

Multiple Choice

Underlying the theory of comparative advantage are assumptions regarding

• A)free trade between nations.
• B)that the factors of production (land,labor,capital,and entrepreneurial ability)are relatively immobile.
• C)that the factors of production (land,labor,capital,and entrepreneurial ability)are relatively mobile.
• D)free trade between nations and that the factors of production (land,labor,capital,and entrepreneurial ability)are relatively immobile.

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Definitions:

Dumping

The practice of selling a product in a foreign market at a price below its domestic market price or below the cost of production.

Tariffs

Taxes imposed on imported goods and services, aimed at making them more expensive to protect local industries from foreign competition.

Revenue

The total income generated by a company from its business activities, typically from the sales of goods or services before any expenses are deducted.

Break-even

The point at which total costs and total revenue are equal, meaning that a business neither makes a profit nor suffers a loss.