According to the theory of comparative advantage, countries gain from trade because: Which of the 5? 1.Trade makes firms behave more competitively, reducing their market power. 2. World output can rise when each country specializes in what its does relatively best. 3. Every country has an absolute advantage in producing something. 4. All firms can take advantage of cheap labor. 5. Output per worker in each firm increases.
According to the theory of comparative advantage, countries gain from trade because: Which of the 5? 1.Trade makes firms behave more competitively, reducing their market power. 2. World output can rise when each country specializes in what its does relatively best. 3. Every country has an absolute advantage in producing something. 4. All firms can take advantage of cheap labor. 5. Output per worker in each firm increases.
Chapter28: International Trade
Section: Chapter Questions
Problem 2P
Related questions
Question
100%
According to the theory of comparative advantage , countries gain from trade because:
Which of the 5?
1.Trade makes firms behave more competitively, reducing their market power.
2. World output can rise when each country specializes in what its does relatively best.
3. Every country has an absolute advantage in producing something.
4. All firms can take advantage of cheap labor.
5. Output per worker in each firm increases.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax
Economics Today and Tomorrow, Student Edition
Economics
ISBN:
9780078747663
Author:
McGraw-Hill
Publisher:
Glencoe/McGraw-Hill School Pub Co
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax
Economics Today and Tomorrow, Student Edition
Economics
ISBN:
9780078747663
Author:
McGraw-Hill
Publisher:
Glencoe/McGraw-Hill School Pub Co
Brief Principles of Macroeconomics (MindTap Cours…
Economics
ISBN:
9781337091985
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Macroeconomics (MindTap Course List)
Economics
ISBN:
9781305971509
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics, 7th Edition (MindTap Cou…
Economics
ISBN:
9781285165875
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning