A Country Has a Comparative Advantage in a Product If

question 38

Multiple Choice

A country has a comparative advantage in a product if the world price is

• A)lower than that country's domestic price without trade.
• B)higher than that country's domestic price without trade.
• C)equal to that country's domestic price without trade.
• D)not subject to manipulation by organizations that govern international trade.

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Definitions:

Variable Factory Overhead

Refers to the indirect, variable costs that change with the level of production output, such as utilities for the manufacturing plant.

Controllable Variance

The difference between the actual variable overhead costs and the budgeted variable overhead for actual production.

Direct Materials Quantity Variance

The difference between the actual quantity and the standard quantity of direct materials used in producing a product multiplied by the standard direct material price.

Units

A measure of quantity used to express the amount of a product, service, or resource used or produced in a transaction.