ECONOMICS
TRADE EXCHANGE AND INTERDEPENDENCE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Low skill products
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High tech goods
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Finished products
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High skill products
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Detailed explanation-1: -Foreign trade expands a country’s market for its products. Exports have the potential to boost national output and serve as a growth engine. Expansion of a country’s foreign trade may revitalise an otherwise dormant economy and lead it down the road to wealth and growth.
Detailed explanation-2: -The correct answer is D. Those goods in which other nations have a comparative advantage.
Detailed explanation-3: -Most less-developed countries have agriculture-based economies, and many are tropical, causing them to rely heavily upon the proceeds from export of one or two crops, such as coffee, cacao, or sugar.
Detailed explanation-4: -The principle of comparative advantage states that each country should specialize in the goods it can produce most readily and cheaply and trade them for those that other countries can produce most readily and cheaply.