The Impact of Increasing, as Opposed to Constant, Costs Is

question 56

Multiple Choice

The impact of increasing, as opposed to constant, costs is to

• A) intensify and prolong the comparative advantages that any nation may have initially.
• B) expand the limits of the terms of trade.
• C) cause the bases for further specialization to disappear as nations specialize according to comparative advantage.
• D) cause nations to realize economies of scale in those products in which they specialize.