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According to What Economists Call the "Law of One Price

Question 37

Multiple Choice

According to what economists call the "law of one price",


A) the world price of a commodity is established by the country with the highest opportunity cost in producing the product without respect to the domestic or world demand for the product.
B) the lower the costs to move a product from one market to the other, the more equal the prices for the same product when it is sold in different markets.
C) the world price of a commodity is established by the country with the highest relative demand for that product without respect to the cost of production.
D) the price of a given product will never be equal in two different markets because of differences in the patterns of demand.
E) the price of a specific product will be the same in any two markets in which the cost of labour is the same.

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