The theory of comparative advantage believes that even if a country is less efficient than another in the production of both commodities, there is still a basis for mutually beneficial trade.
举一反三
- _______explains how mutually beneficial trade can take place even when one nation is less efficient than another nation in the production of all commodities.（ ） A: Mercantilism B: The law of comparative advantage C: The labor theory of value D: The law of absolute advantage
- ( ) determines the direction of trade and the limits to<br/>mutually beneficial trade. A: Specialization B: Absolute advantage C: Factor abundance D: Comparative advantage
- The law of comparative advantage ( ). A: explains how a country can benefit from trade even if it has absolute disadvantage in production of all commodities. B: explains how the most efficient nations can benefit from trade. C: was introduced by Adam Smith. D: is used to explain the trade between intra-industry trade.
- To the country of production or the country of consumption, the trade made through the third country is indirect trade; to the third country, it is entrepot trade.
- The H-O model extends the classical trade model by: A: explaining the basis for comparative advantage B: examining the effect of trade on factor prices C: both A and B D: neither A nor B