In a Two-Nation, Two-Good World, Which of the Following Statements

question 130

Multiple Choice

In a two-nation, two-good world, which of the following statements is true?

• A) One nation cannot possibly have an absolute advantage over the other nation in both products
• B) If one nation as the comparative advantage in one product, then the other nation would have the comparative advantage in the other product
• C) One nation will always have the comparative advantage over the other nation in one of the products
• D) If one nation has the absolute advantage in one product, then the other nation would have the absolute advantage in the other product

---

Definitions:

Prescriptive

Relating to providing guidance or recommendations on what actions to take, often based on analytical models.

Predictive

Relating to the ability to use known data to forecast the value, trend, or likelihood of an event happening in the future.

Descriptive

Pertains to statistical methods used to summarize, show, or describe data features without drawing conclusions or inferring from the sample to the population.

Categories

Distinct groups or classifications into which items or observations are divided based on shared qualities or characteristics.