Asked by Julio Cesar Meirelles on May 03, 2024
Verified
The principle of comparative advantage indicates that mutually beneficial international trade can take place only when
A) tariffs are eliminated.
B) transportation costs are almost zero.
C) relative costs of production differ between nations.
D) a country can produce more of some product than other nations can.
Comparative Advantage
The expertise of an individual, a corporation, or a sovereign state to create a commodity or a service that bears a lower opportunity cost than that of competing entities.
Relative Costs
The cost of one good or service compared to another, often considered in terms of the opportunity cost of choosing one option over another.
- Identify the advantages of focusing on specialized tasks and engaging in trade grounded on the principle of comparative advantage.
- Explore how variances in manufacturing costs among nations enhance international commerce.
Verified Answer
Learning Objectives
- Identify the advantages of focusing on specialized tasks and engaging in trade grounded on the principle of comparative advantage.
- Explore how variances in manufacturing costs among nations enhance international commerce.
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