Suppose That the Country of Xenophobia Chose to Isolate Itself

question 55

Multiple Choice

Suppose that the country of Xenophobia chose to isolate itself from the rest of the world.Its ruler proclaimed that Xenophobia should become self-sufficient,so it would not engage in foreign trade.From an economic perspective,this idea would

• A)make sense if Xenophobia had an absolute advantage in all goods.
• B)make sense if Xenophobia had no absolute advantages in any good.
• C)not make sense as long as Xenophobia had a comparative advantage in some good.
• D)not make sense as long as Xenophobia had an absolute advantage in at least half the goods that could be traded.

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Definitions:

Course of Dealing

A legal term referring to the previous conduct between parties in a contract that establishes a common basis for their understanding.

Perfect Tender Rule

A legal principle stating that a seller must deliver goods in accordance with the contract terms in every detail for the buyer to accept them.

Material Requirements

Specific essential resources or inputs needed for a project, production, or manufacturing process.

Unconscionability

Refers to a situation where a contract is so unfairly one-sided that it shocks the conscience, often due to undue influence, duress, or gross inequality in bargaining power.