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Questions and Answers
Which theory assumes relative labor productivity, labor costs, and product prices differ in two countries before trade?
Which theory assumes relative labor productivity, labor costs, and product prices differ in two countries before trade?
- Ricardian theory (correct)
- Leontief Paradox theory
- Product Cycle theory
- Industrial Policy theory
What does the Ricardian theory rule out, according to the text?
What does the Ricardian theory rule out, according to the text?
- Explanation of how trade affects the distribution of income among factors
- Explanation of why some favor trade while others oppose it
- Both a and b (correct)
- None of the above
Which theory is based on the assumption of overlapping demands as a basis for trade?
Which theory is based on the assumption of overlapping demands as a basis for trade?
- Product Cycle theory
- Intra-Industry Trade theory (correct)
- Ricardian theory
- Leontief Paradox theory
Which organization rules that illegal government subsidies support Boeing and Airbus?
Which organization rules that illegal government subsidies support Boeing and Airbus?
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What does the Ricardian theory assume as the sole factor of production before trade?
What does the Ricardian theory assume as the sole factor of production before trade?
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