Trade Based Upon Comparative Advantage Is Economically Beneficial Because

question 4

Multiple Choice

Trade based upon comparative advantage is economically beneficial because:

• A)it promotes an efficient allocation of world resources
• B)it gives consumers a narrower range of products to choose from
• C)it gives governments the chance to charge high tariffs on imports
• D)it allows government policy makers to choose the products the economy will specialize in
• E)it gives domestic businesses the chance to reduce the number of competitors they face in product markets

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Definitions:

Earnings Per Share

Earnings Per Share (EPS) is a measure of a company's profitability, calculated as net income divided by the number of outstanding shares.

Legal Capital

The portion of a company's capital, represented by the par value of its issued shares, that cannot legally be distributed to shareholders as dividends.

Contributed Capital

Contributed Capital, also known as paid-in capital, refers to the amount of money raised by a company through the sale of its equity shares.

Premium on Common Stock

The amount by which the sale price of a share of common stock exceeds its par value.