Gains from Trade pop quiz

Susan can score seven goals, where as Rob can score five. Susan has

• an absolute advantage.

• a comparative advantage.

• a domestic advantage.

• a specialized advantage.

When does a person have a comparative advantage?

• when they can produce a good using fewer resources

• when they have a lower opportunity cost than others

• when they buy a good for less than its production cost

• when they have a higher opportunity cost than others

________ based on comparative advantage benefits both trading partners.

• Division of Labor

• Voluntary exchange

• Interdependence

• Specialization

Which of the following could contribute to a nation having a comparative advantage over another nation?

• a warmer climate

• better education

• lots of forests

• all of the above

What is one reason trade makes people wealthier?

• It raises the price of goods.

• It decreases competition.

• It lowers the cost of goods.

• all of the above