The situation where a country both exports and imports goods in the same product classification category is known as __________ trade, and such a trade situation for countries in the real world is likely to be __________ associated with country per capita income levels.

Question

Quizplus · Accepted Answer

The situation described in the question is that of intra-industry trade, where a country both exports and imports goods in the same product classification category. Intra-industry trade is positively associated with country per capita income levels, indicating that countries with higher income levels are more likely to engage in this type of trade. This is because higher income levels allow countries to invest in technology and research and development, leading to greater product differentiation and specialization. Therefore, option A is the correct answer.

The Situation Where a Country Both Exports and Imports Goods