A Country with a Lower Relative Cost of Production of a Particular

question 170

Multiple Choice

A country with a lower relative cost of production of a particular good has a(n) _______ advantage and it is likely to _______ this good.

• A) absolute; import
• B) comparative; import
• C) comparative; export
• D) absolute; not export

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Definitions:

Sustainable Operating Earnings

The portion of a company's profit that is expected to continue in the future, excluding any one-time items or unusual income.

Big Bath Items

Large and often one-time charges taken by a company to write off or write down the value of assets, or to provide for expected future liabilities, sometimes used to manage earnings.

Restructuring

A process of reorganizing a company's structure, operations, or finances with the goal of increasing efficiency or to prepare the business for a sale, merger, or change in strategy.

GAAP

Generally Accepted Accounting Principles, a set of accounting standards and practices formally established to bring consistency to financial reporting.