SSC
WORLD GEOGRAPHY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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all nations belong to free trade agreements
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all nations seek out new production methods
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no nation has all necessary resources
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no nation can employ all of its laborers
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Detailed explanation-1: -Which statement best explains why nations must trade? All nations belong to free trade agreements.
Detailed explanation-2: -Even when one country has an absolute advantage in all products, trade can still benefit both sides. This is because gains from trade come from specializing in one’s comparative advantage.
Detailed explanation-3: -The balance of trade is typically measured as the difference between a country’s exports and imports of goods. To calculate the balance of trade, you would subtract the value of a country’s imports from the value of its exports.
Detailed explanation-4: -The theory of comparative advantage introduces opportunity cost as a factor for analysis in choosing between different options for production. Comparative advantage suggests that countries will engage in trade with one another, exporting the goods that they have a relative advantage in.