T.Y.B. Com: Business Economics VI

Ricardian theory assumes perfect mobility of Labour

• Within the country

• Between the countries

• Both within and between the countries

• Between states

Ricardian comparative cost theory can be extended or applied to

• More than two commodities

• Only two countries

• Only to developed countries

• Intra-regional

An offer curve ..........

• Differs from an usual demand curve only

• Differs from an usual supply curve only

• Differs from both usual demand and supply curves

• Differs in other countries

Terms of trade are expressed as a ..............

• Ratio of foreign exchange receipts and payments

• Ratio of price index of exports and imports

• Ratio of foreign direct investment and portfolio investment

• Ratio of changes indirectly

H. O. Theory can explain

• Inter-regional trade

• International Trade

• Both

• Intra

Commodity X is capital intensive if in its production

• Capital/Labour (K/L) ratio is greater than Y

• Physical units of K and L are greater than Y

• X requires better technology than Y

• Y requires better technology than X

Comparative cost theory is a static theory because according to it

• There is no qualitative and quantitative change in inputs

• Labour is homogeneous within the country

• There is no transport cost

• Labour is heterogeneous

Ricardian theory measures comparative cost in terms of

• Money

• Labour days

• Cost of all the inputs

• Input Factors

Ricardian theory assumes that

• Labour is homogeneous and of same efficiency in all the countries

• Labour is homogeneous within the country

• Labour differs in efficiency within the country

• Labour is heterogeneous

Which one of the following is an argument for free trade?

• Protects domestic industries

• Promotes self sufficiency

• Helps diversification of industries

• Promotes efficient allocation of world resources