Economic International Trade

What is comparative advantage in international trade?

• Ability of a country to produce a good or service without considering opportunity cost.

• Ability of a country to produce a good or service at a higher opportunity cost than other countries.

• Ability of a country to produce a good or service at the same opportunity cost as other countries.

• Ability of a country to produce a good or service at a lower opportunity cost than other countries

What is absolute advantage in international trade?

• A country's ability to produce a good or service more efficiently than another country.

• A country's ability to produce a good or service without considering efficiency.

• A country's ability to produce a good or service at the same efficiency as another country.

• A country's ability to produce a good or service less efficiently than another country.

What are the benefits of international trade?

• Increased economic growth, access to a wider range of goods and services, lower prices for consumers, job creation, and fostering international relations.

• Stagnant economic growth, limited access to goods and services, higher prices for consumers, job loss, and strained international relations.

• Reduced economic growth, limited access to goods and services, higher prices for consumers, job loss, and strained international relations.

• Decreased economic growth, limited access to goods and services, higher prices for consumers, job loss, and strained international relations.

What are the disadvantages of international trade?

• Higher transportation costs, cultural barriers, and trade imbalances.

• Increased competition, loss of domestic jobs, and dependency on foreign countries for essential goods.

Which concept explains why countries specialize in producing goods they have a lower opportunity cost for?

• absolute advantage

• comparative advantage

• trade deficit

• opportunity cost

Which concept explains why countries trade even if they have an absolute advantage in producing all goods?

• comparative advantage

• tariffs

• balance of trade

• opportunity cost

Name one benefit of international trade.

• Reduced employment opportunities

• Limited access to foreign markets

• Increased economic growth and prosperity

• Decreased competition

Name one disadvantage of international trade.

• Job loss in domestic industries

• Decreased national security.

• Increased competition.

• Loss of cultural identity.

What is the main reason countries engage in international trade?

• Comparative advantage

• Economic growth

• Political stability

• Cultural exchange

What is the main reason countries may restrict international trade?

• To promote economic growth and development.

• To maintain national security and protect sensitive industries.

• To protect domestic industries and jobs from foreign competition.

• To increase government revenue through tariffs and import taxes.