Subject = Global Business The comparative advantage theory holds that a country
ID: 421926 • Letter: S
Question
Subject = Global Business
The comparative advantage theory holds that a country will gain from trade ________.
a. when it exports products for which it has an acquired advantage and imports products for which another country has a natural advantage
b. if it exports goods it can produce more efficiently than other countries and imports goods other countries can produce more efficiently than it can
c. even though it can produce all goods more efficiently than other countries
d. if it exports products using its abundant production factors in exchange for products for which it has scarce production factors
Explanation / Answer
The comparative advantage theory holds that a country will gain from trade --- When it exports products for which it has an acquired advantage and imports products for which another country has a natural advantage.