A Country Will Export a Good If It

question 146

Multiple Choice

A country will export a good if it

• A) can sell the good to a foreigner at a higher price than the no-trade domestic price.
• B) can sell the good to a foreigner at a lower price than the no-trade domestic price.
• C) can dump the good on the world market.
• D) has a high opportunity cost of production.
• E) is impossible to import the good.

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Definitions:

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return.

Trust Fund

A fund comprised of a variety of assets intended to provide benefits to an individual or organization.

Effective Rate

is the interest rate on a loan or financial product, restated from the nominal rate as an annual rate that may incorporate compounding.

Endowment Fund

A financial endowment given to institutions like universities, museums, and non-profits to invest and use the annual income from investments for operations or programs.