When the principle of comparative advantage determines trade, then a country will specialize only in that good with the highest opportunity cost. specialize only in that good where output is less per worker hour than another country. specialize only in goods with the lowest opportunity costs. O specialize only in that good where production costs are more than average total costs.

When the principle of comparative advantage determines trade, then a country will specialize only in that good with the highest opportunity cost. specialize only in that good where output is less per worker hour than another country. specialize only in goods with the lowest opportunity costs. O specialize only in that good where production costs are more than average total costs.

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter1: Multinational Financial Management: An Overview

Section: Chapter Questions

Problem 2QA

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QUESTION 2 A difference between a quota and a tariff is that a tariff generates a greater reduction in exports. the government collects revenues from a tariff, which does not happen with a quota. a quota increases profits of domestic producers more than a tariff does. a tariff generates a higher price than a quota does.
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QUESTION 4 A quota is a market-imposed balancing factor that keeps prices of imports and exports in equilibrium. a law that prevents ecologically damaging goods from being imported into a country. a tariff imposed on goods that are dumped in the country. a government-imposed restriction on the quantity of a specific good that can be imported.
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