In the Presence of External Economies of Scale,trade

question 11

Multiple Choice

In the presence of external economies of scale,trade

• A) may or may not improve welfare in both countries.
• B) will unambiguously improves welfare in both countries.
• C) will unambiguously worsens welfare in both countries.
• D) will unambiguously worsen welfare in the exporting country and improve welfare in the importing country.
• E) will unambiguously improve welfare in the exporting country and worsen welfare in the importing country.

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Definitions:

Equity Investment

Investment in stock or equity interests of a company, representing ownership and often granting voting rights and dividends to the investor.

Fair Value Model

An accounting approach where assets and liabilities are revalued periodically to reflect their current market values rather than historical cost.

Amortized Cost Model

An accounting method where the carrying amount of a financial asset or liability is adjusted for amortization of discount/premium and impairment losses.

Year End

The end of a fiscal year when a company completes its accounting period and financial statements are prepared.