• 2022-06-07
    When two nations trade with each other, the region of mutually beneficial trade is decided by their domestic cost ratios.
  • 内容

    • 0

      According to the absolute advantage, trade occurs only when each country has an/a______ advantage over the other in producing one commodity.

    • 1

      ( ) determines the direction of trade and the limits to<br/>mutually beneficial trade. A: Specialization B: Absolute advantage C: Factor abundance D: Comparative advantage

    • 2

      Given free trade, small nations tend to benefitfrom trade compared with large nations because . A: A.Less; Small nations enjoy terms of trade lying near the opportunity costs of themselves B: B.Less; Small nations enjoy terms of trade lying near the opportunity costs of their large trading partners C: More; Small nations enjoy terms of trade lying near the opportunity costs of themselves D: D.More; Small nations enjoy terms of trade lying near the opportunity costs of their large trading partners

    • 3

      Assuming increasing cost conditions, trade between two countries would not be likely if they have:

    • 4

      Every time we walk into a store, restaurant, theater or any other place of business to buy something, we trade. Basically, international trade does not differ from trade with other people in our country. The key to understanding trade is to remember why it takes place. The reason people trade, regardless of where they live, is that they believe they will be better off by trading. When we consider the alternative—each of us producing everything for ourselves—trade simply makes more sense.