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New Trade Theory Dictates That Trade Offers an Opportunity for Mutual

Question 95

Multiple Choice

New trade theory dictates that trade offers an opportunity for mutual gain when countries do not differ in their resource endowments or technology because trade


A) results in a contraction of the size of the markets of individual firms.
B) allows for production of products at higher prices.
C) increases the variety of goods available to consumers and lowers the costs of those goods.
D) allows countries to attain self-sufficiency in the production of all goods.
E) guarantees first-mover advantages to all the countries that engage in trade.

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