Which of the following are true regarding international trade? Check all that su

Question

Which of the following are true regarding international trade? Check all that supply
A) Trade raises wages in both exporting and importing countries.
B)Wages reflect comparative advantage
C)Countries can only export goods in which they have an absolute advantage.
D)The pattern of trade is determined by comparative advantage. Which of the following are true regarding international trade? Check all that supply
A) Trade raises wages in both exporting and importing countries.
B)Wages reflect comparative advantage
C)Countries can only export goods in which they have an absolute advantage.
D)The pattern of trade is determined by comparative advantage.
A) Trade raises wages in both exporting and importing countries.
B)Wages reflect comparative advantage
C)Countries can only export goods in which they have an absolute advantage.
D)The pattern of trade is determined by comparative advantage.

Explanation / Answer

The correct answer is C & D

Explanation:- Most countries tend to specialize in the production of commodities in which they have absolute advantage in the cost of production. They export goods which they can produce at a lower cost and import what they can produce at a higher cost. Comparative advantage help in determining whether a country is relatively specialised in a given industry's exports.

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