Should international transportation costs decrease, the effect on international trade would include:
Anincreaseinthevolumeoftrade
B. Asmallergainfromtrade
C. Adeclineinthe income of home producers
D. Adecrease in level of specialization in production.
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That the division of labor is limited by the size of the market best applies to which explanation of trade?
A. Factorendowmenttheory
B. Productlife cycle theory
C. Economiesofscaletheory
D. Overlapping demand theory
A larger variety of products results from international trade especially if:
A. Internationaltradeaffordsproducersmonopolypower
B. Nationalgovernmentslevyimporttariffsandquotas
C. Producinggoodsentailsincreasingcosts
D. Economiesofscaleexistforproducers
With economies of scale and decreasing unit costs, a country has the incentive to:
A. Specializecompletelyintheproduct of its comparative advantage
B. Specializepartiallyinthe product of its comparative advantage
C. Specializecompletelyinthe product of its comparative disadvantage
D. Specializepartiallyintheproduct of its comparative disadvantage
Proponents of ____ maintain that government should enact polices that encourage the decelopment of emerging, "sunrise" industries.
A. Productlifecyclepolicy
B. Staticcomparativeadvantagepolicy
C. Intra-industrytradepolicy
D. Industrialpolicy
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