The Theory of Comparative Advantage Implies That

question 219

Multiple Choice

The theory of comparative advantage implies that

• A)the United States could have a comparative disadvantage in producing all goods and services.
• B)two countries can have a comparative advantage in production of the same good.
• C)the world gains from trade since it allows production to move to the countries where their opportunity cost is lowest.
• D)the country with the comparative advantage also has an absolute advantage.

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Definitions:

Worker and Collective Farm Woman

A notable socialist realist sculpture symbolizing the Soviet Union's ideal of gender equality in labor and contribution to collective farming.

Universal Means

Methods or tools that are globally applicable or effective across a wide range of situations.

De Stijl

A Dutch artistic movement focused on reducing forms and colors to their essentials, using only primary colors, black, and white, and simple geometric shapes.

Piet Mondrian

A Dutch painter and theoretician who is regarded as one of the greatest artists of the 20th century, pioneering the abstract art movement with his unique grid-based composition.