alleryStart learning →Under specialisation, mutually beneficial terms of trade lie between what?
ABoth opportunity costs
BZero and the world price
CBoth tariff rates
DTop and bottom wages
Answer & Solution
Correct answer: A. Both opportunity costs
Each country gains only if it gets a better rate than its own opportunity cost, so the rate falls between the two.
Keep practising International Trade
Browse all International Trade questions for CA Foundation, or explore more Business Economics topics.
Related questions
Which view blames a global savings glut for BoP imbalances, argued in a 2005 paper?A country selling more than it imports sees what happen to demand for its currency?After Bretton Woods ended, which currency remained the principal de facto reserve?A current account surplus is equivalent to the excess of what?A fall in a currency's value makes imports what for a country's citizens?Currency appreciation does what to exports and imports?A balance of payments crisis occurs when a nation cannot do what?If outflows exceed inflows, what pressure does the country's currency face?