If a country finds its comparative advantage in computer
Production, which is capital intensive, what will happen to
The rental rate on capital when trade occurs?
A)It will decrease.
B)It will stay the same.
C)It will increase.
D)Not enough information is given to answer this question.

Question

Quizplus · Accepted Answer

With the country's comparative advantage in producing computer, it will increase its demand for capital, leading to an increase in the rental rate on capital when trade occurs.

If a Country Finds Its Comparative Advantage in Computer