When a Country Specializes in the Production of a Good

question 17

Multiple Choice

When a country specializes in the production of a good that is relatively cheaper for it to produce than other goods, it is because of:

• A) the foreign-trade multiplier.
• B) comparative advantage.
• C) nontariff barriers.
• D) absolute advantage.

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Definitions:

Exclusive Right

A legal provision granting someone the sole permission to engage in a particular activity or use a specific property.

Law of Torts

The body of laws governing civil wrongs that allow the injured party to receive compensation from those responsible for causing the harm.

Reallocates Losses

describes the process of redistributing financial burdens or losses, often seen in insurance, investment, or risk management contexts, to adjust the impact on involved parties.

Trespass

An unauthorized intrusion on someone else's property or rights, which can be the basis for a legal claim.