GDP vs GNP: Understanding the Difference

To gain an absolute advantage over other nations

To increase their imports and reduce their exports

To specialize in the production of goods and services in which they have a comparative advantage (correct)

To reduce the number of goods and services produced domestically

Trade deficit

Net exports

Trade surplus (correct)

Balance of trade

Absolute advantage is the ability to produce a specific product more cheaply than any other nation, while comparative advantage is the ability to produce a specific product more efficiently than any other nation.

Absolute advantage is the ability to produce a specific product more efficiently than any other nation, while comparative advantage is the ability to produce a specific product more quickly than any other nation.

Absolute advantage is the ability to produce a specific product more efficiently than any other nation, while comparative advantage is the ability to produce a specific product more cheaply than any other nation.

Absolute advantage is the ability to produce a specific product more efficiently than any other nation, while comparative advantage is the ability to produce a specific product more efficiently than any other product. (correct)

<p>Net exports</p> Signup and view all the answers

<p>Comparative advantage</p> Signup and view all the answers