A. A would export X to B
B. A would export Y to B
C. Neither country would want to trade
D. None of the above
Related Mcqs:
- The comparative advantage comes if each trading partners has a product that will bring a better price in another country than it will at home. Which economist proposed the principle of comparative advantage ?
A. Adam Smith
B. David Ricardo
C. David Smith
D. Adam Ricardo - When free trade areas are set up the member countries trade with each other grows faster than their trade with other countries This is due to what economist call ?
A. trade diversion
B. trade channeling
C. trade creation and trade diversion
D. trade creation - If the countries were to trade along the lines of absolute advantage ?
A. A would export X to B
B. B would import Y from A
C. Neither country would want to trade
D. None of the above - Which industrialization policy have developing countries used which places emphasis on the comparative advantage principle as a guide to resource allocation ?
A. export promotion
B. import promotion
C. international commodity agreements
D. multilateral contracts - The Heckscher-Ohlin theory explains comparative advantage as the result of differences in countries ?
A. Economies of large-scale production
B. Relative abundance of various resources
C. Relative costs of labor
D. Research and development expenditures - If tastes are identical between countries, then comparative advantage is determined by ?
A. supply condition only
B. demand conditions only
C. supply and demand conditions
D. can’t tell without more information - Country A has the comparative advantage in ?
A. Wine
B. Beer
C. Both wine and beer
D. Neither wine nor beer - According to the principle of comparative advantage ?
A. South Korea should export steel
B. South Korea should export steel and DVDs
C. Japan should export steel
D. Japan should export steel and DVDs - Comparative advantage is determined by ?
A. actual differences in labor productivity between countries
B. relative differences in labor productivity between countries
C. Both (a) and (b)
D. Neither (a) nor (b) - Country B has the comparative advantage in ?
A. Wine
B. Beer
C. Both wine and beer
D. Neither wine nor beer
