Since Production Has Shifted to More Efficient Producers Due to Comparative

question 8

Multiple Choice

Since production has shifted to more efficient producers due to comparative advantage, consumers in Country X have had access to more goods at lower prices.Which of the following most likely exists?

• A)trade specialization
• B)trade diversion
• C)trade creation
• D)trade internalization

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Definitions:

Percentage of Net Sales

A financial ratio that represents certain expenses, liabilities, or profits as a percentage of the net sales, used to analyze the financial health and performance of a business.

Bad Debts

Amounts owed to a company that are considered uncollectible, typically due to the debtor's inability to pay.

Factoring Commissions

Factoring commissions are fees paid to a factor, or financial intermediary, for advancing funds to a business by purchasing its accounts receivable.

Accounts Receivable

Amounts owed to a business by its customers for goods or services delivered or used but not yet paid for.