Countries with Large Land Areas Are Generally Less Dependent on Trade

question 19

Multiple Choice

Countries with large land areas are generally less dependent on trade than countries with small land areas because of ________.

• A)highly restricted economic scales
• B)self-sufficiency with natural resources
• C)higher transportation costs related to foreign trade
• D)the development of unique products that have a limited demand

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Definitions:

Induced Consumption

Consumer spending that is influenced by changes in income, differentiating from autonomous consumption which does not vary with income.

Disposable Income

The liquidity households have for spending and saving, after income taxes have been deducted.

Consumption

The act of using goods and services by households that leads to a decrease in their availability.

APC

In economics, stands for Average Propensity to Consume, which is the ratio of total consumption to total disposable income.