If There Are Two Goods and Two Countries, Then One

question 205

Multiple Choice

If there are two goods and two countries, then one country can have

• A) a comparative advantage in only one good.
• B) a comparative advantage in both goods.
• C) a higher opportunity cost of producing both goods.
• D) a lower opportunity cost of producing both goods.

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Definitions:

Severe Recession

A period of significant economic decline that is longer and more destructive than a standard recession, often characterized by high unemployment, falling prices, and low levels of production and investment.

Economy

The system of production, distribution, and consumption of goods and services within a particular geographical region.

Point P

This term could be referring to a specific point on a graph or chart, usually in a mathematical or economic context, representing a particular value or condition.

Production Possibilities Curve

A graphical representation showing the maximum quantity of goods and services that an economy can produce when all resources are fully employed.