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Small Countries Enjoy a Larger Share of the Gain from Specialization

Question 50

Multiple Choice

Small countries enjoy a larger share of the gain from specialization and trade than large countries because:


A) they can trade at prices closer to their consumption possibilities curves than can large countries.
B) they are more nimble in reallocating their resources to export industries.
C) large countries are not interested in competing for trade with small countries.
D) large countries prefer to trade at their domestic opportunity costs rather than at small country opportunity costs.

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