The economist Paul Samuelson analyzed a scenario in
Which R&D production suffers from foreign competition,
Thus lowering its price.Samuelson notes that foreign
Competition in R&D will generally ____ the terms of
Trade and national welfare if the nation exports R&D.
A)raise
B)lower
C)help
D)not affect

Question

Quizplus · Accepted Answer

According to Samuelson, foreign competition in R&D will generally lower the terms of trade and national welfare if the nation exports R&D. This is because foreign competition will lead to a decrease in the price of R&D, which will lower the income earned by the country exporting it, and the welfare of the exporting nation.

The Economist Paul Samuelson Analyzed a Scenario in