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

Two countries engaged in trade in products with no scale economies, produced underconditions of perfect competition, are likely to be engaged inA) Heckscher-Ohlin trade.B) oligopolistic competitionC) monopolistic competition.D) intra-industry trade.E) inter-industry trade.

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.

Intra-industry trade occurs when a country tends to export one good and imports a wholly different type of good from another country.A. TrueB. False

Intra-industry trade will tend to dominate trade flows when which of the following exists?A) large differences between relative country factor availabilitiesB) small differences between relative country factor availabilitiesC) uneven distribution of abundant resources between two countriesD) homogeneous products that cannot be differentiatedE) constant cost industries

A product is produced in a monopolistically competitive industry with scale economies. If thisindustry exists in two countries, and these two countries engage in trade with each other, then wewould expectA) the country with a relative abundance of the factor of production in which production of theproduct is intensive will export this product.B) the countries will trade only with other nations they are not in competition with.C) the country in which the price of the product is lower will export the product.D) neither country will export this product since there is no comparative advantage.E) each country will export different varieties of the product to the other.