MCQOPTIONS
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| 1. |
By adjusting the model of comparative advantage to include transportation costs along with production costs we would expect ? |
| A. | The prices of trade goods to be lower than when there are no transportation costs |
| B. | specialization to stop when the production costs of the trading partners equalize |
| C. | The volume of trade to be less than when there are no transportation costs |
| D. | The gains from trade to be greater than when there are no transportation costs |
| Answer» D. The gains from trade to be greater than when there are no transportation costs | |