If trade in a particular good interindustry,the expansion of an industry in one country is likely to lead to the ________ of that industry in the other country.If trade in that good is intraindustry,expansion of the industry in one country is likely to lead to the ________ in the other country.
A)decline, decline
B)decline, expansion
C)expansion, decline
D)expansion, expansion

Question

Quizplus · Accepted Answer

In interindustry trade, countries specialize in different industries, so if one country expands in a particular industry, it may lead to the decline of that industry in another country due to competitive imports. In intraindustry trade, countries trade similar products, so expansion in one country can lead to expansion in the other, as they exchange different varieties of similar goods.

If Trade in a Particular Good Interindustry,the Expansion of an Industry