International trade can have important effects on the distribution of income because
A) different industries employ different factors of production.
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 affect the distribution of income because different industries may require different factors of production, such as labor or capital. This can lead to shifts in employment and wages, and potentially affect income distribution within a country or between countries. For example, if a developed country specializes in high-tech industries that require skilled workers and capital, while a developing country specializes in labor-intensive industries such as textiles, the developed country may have higher wages and more skilled workers while the developing country may have lower wages and less skilled workers.

International Trade Can Have Important Effects on the Distribution of Income