To obtain good A in which one does not have a comparative advantage, it is better to acquire it by "indirect production" – producing good B, in which one does have a comparative advantage, and trading it for good A. True False False
To obtain good A in which one does not have a comparative advantage, it is better to acquire it by "indirect production" – producing good B, in which one does have a comparative advantage, and trading it for good A. True False False
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter33: International Trade
Section: Chapter Questions
Problem 28CTQ: Can a nations comparative advantage change over time? What factors would make it change?
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34. To obtain good A in which one does not have a
True
False
False
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Law of comparative cost advantage explains how trade can be beneficial for both the Nations if one country has absolute disadvantage in the production of both the goods.
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