Level 1
CPA Exam
10%
Q1
10 Qs
Q1
The below options are all correct about international trade
EXCEPT
_________
.
Select Answer
The gains from international trade depend on specialization with comparative advantage.
Absolute advantage is defined as the ability of one nation to produce a product at a relatively lower opportunity cost than another nation.
Absolute advantage without comparative advantage does not result in gains from international trade.
Where there is reciprocal absolute advantage between two countries, specialization will make it possible to produce more of each product.
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