A country engaging in trade according to the principles of comparative advantage gains fromtrade because itA) is producing exports indirectly more efficiently than it could alternatively.B) is producing imports indirectly more efficiently than it could domestically.C) is producing exports using fewer labor units.D) is producing imports indirectly using more labor units.E) is producing exports while outsourcing services.

4. When a country both exports and imports a type of commodity, the country is engaged inA) inter-industry trade.B) an attempt to monopolize the relevant industry.C) increasing returns to scale.D) intra-industry trade.E) imperfect competition

According to Ricardo, a country will have a comparative advantage in the product in which itsA) labor productivity is relatively low.B) labor productivity is relatively high.C) labor mobility is relatively low.D) labor mobility is relatively high.E) labor is outsourced to neighboring countries.

What should a country that wants to increase its comparative advantage when trading with another country try to do?A.Reduce its trade deficit with all of its other trading partnersB.Lower the opportunity cost of producing the goods it tradesC.Raise the price of its exports to generate more capitalD.Produce more of a valuable good than the other country

How do countries develop a comparative advantage over their trading partners?A.By producing more essential goods than other countriesB.By having lower opportunity costs for producing certain goodsC.By lowering the trade deficits they have with their neighborsD.By reducing their reliance on foreign trade for essential goods

If a country exports a greater value of goods than it imports, it has a(n) _____.A.absolute advantageB.trade surplusC.comparative advantageD.trade deficit