Which of the Following Might Lead a Nation to Engage

question 2

Multiple Choice

Which of the following might lead a nation to engage in international trade?

• A)Differences in natural endowments such as climate 
• B)Differences in skills of labor force 
• C)Differences in endowments of natural resources 
• D)All of the above are correct.

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Definitions:

Economic Profit

The profit from producing goods and services while considering both explicit and implicit costs, including opportunity costs.

Producer Surplus

The gap between the price that sellers are prepared to accept for a product and the real price it sells for in the market.

Total Variable Costs

The total of all costs that vary with the level of production or output.

Fixed Costs

Costs that do not change with the level of output or business activity, such as rent, salaries, or loan payments.