The Product Life Cycle Theory of Comparative Advantage Predicts That

question 55

Multiple Choice

The product life cycle theory of comparative advantage predicts that a new product will be first produced and exported by:

• A)the nation that first demanded the new product.
• B)the first firm to successfully copy the technology.
• C)the nation in which it was invented.
• D)the countries with the most stable economies and the fewest restrictions on foreign trade.
• E)the company with the most extensive network of international distributors for the product.

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Definitions:

Owner's Capital

The total equity or net worth owned by the proprietor of a company, reflecting the amount invested plus any retained earnings.