The Theory of Comparative Advantage Implies Which of the Following

question 16

Multiple Choice

The theory of comparative advantage implies which of the following?

• A) A country with an absolute advantage in a good will necessarily have a comparative advantage in that good.
• B) The gains to trade are exactly offset by the losses from trade.
• C) Workers in an industry in which the United States does not have a comparative advantage will be hurt if the United States reduces barriers to trade.
• D) There are gains to trade for a country as long as that country has a comparative advantage in producing the goods that it imports and exports.

---

Definitions:

Peripheral Nerves

Nerves that are located outside of the brain and spinal cord, responsible for transmitting sensory and motor information between the central nervous system and the rest of the body.

Endorphins

Peptides produced by the central nervous system and the pituitary gland, known for their ability to act as natural painkillers.

Heroin

An opioid drug made from morphine, a natural substance taken from the seed pod of various opium poppy plants.

Neurons

Electrically excitable cells that communicate with other cells via specialized connections called synapses, functioning as the basic working unit of the brain.