Use the Following Scenario to Answer the Following Questions

question 4

Multiple Choice

Use the following scenario to answer the following questions:
Suppose that Canada,an industrialized nation,and Mexico,a developing nation,both produce clothes and cars.The real wage in Mexico is lower than in Canada.The countries have a free trade agreement.Each nation will find a comparative advantage.
-Which country's consumers will benefit from the free trade agreement?

• A) neither country
• B) Canada
• C) both countries
• D) Mexico
• E) not enough information to determine

---

Definitions:

Traditional Approach

A common method used in accounting or finance that relies on historical or established practices for processing and analyzing data.

Control Costs

The process of monitoring and managing expenses to ensure they do not exceed the planned budget or resources.

Fixed Overhead Budget

A financial plan that outlines the expected fixed costs that are not dependent on the level of goods or services produced by the organization.

Unexpected Increase

A sudden and unforeseen rise in metrics such as costs, sales, or price levels that was not anticipated as part of the regular business planning process.