If a Very Small Country Trades with a Very Large

question 7

Multiple Choice

If a very small country trades with a very large country according to the Ricardian model,then

• A) the small country will suffer a decrease in economic welfare.
• B) the large country will suffer a decrease in economic welfare.
• C) the small country only will enjoy gains from trade.
• D) the large country will enjoy gains from trade.
• E) both countries will enjoy equal gains from trade.

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