International trade can have important effects on the distribution of income because
A) some resources are immobile in the short run.
B) of government corruption.
C) the more powerful country dictates the terms of trade.
D) rich countries take advantage of poor countries.
E) different countries use different currencies.

Question

Quizplus · Accepted Answer

International trade can lead to unequal gains and losses for different factors of production, and some resources may be immobile in the short run, meaning that workers in industries that face import competition may see a decline in demand for their labor and a fall in wages. On the other hand, owners of capital in export-oriented industries may see an increase in demand for their investments and a rise in profits.

International Trade Can Have Important Effects on the Distribution of Income