Which trade theory suggests that a newly produced good, once exported, could ultimately end up being imported as the technology is transferred to lower-cost nations?
A. Factor endowment theory
B. Product life cycle theory
C. Overlapping demand theory
D. Comparative advantage theory
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A firm is said to enjoy economies of scale over the range of output for which the long-run average cost is:
A. Increasing
B. Constant
C. Decreasing
D. None of the above
A product will be internationally traded as long as the pretrade price differential between the trading partners is:
A. Greater than the cost of transporting it between them
B. Equal to the cost of transporting it between them
C. Less than the cost of transporting it between them
D. None of the above
Which of the following suggests that by widening the market's size, international trade can permit longer production runs for manufacturers, which leads to increasing efficiency?
A. Economiesofscale
B. Diseconomiesof scale
Comparative costtheory
D. Absolute cost theory
The Leontief paradox:
A. was applied to the product life cycle theory.
B. suggested that the US exports labor-intensive goods.
C. found that national income differences underlie world trade patterns.
D. implied that diseconomies of scale occur at low output levels.
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