If countries have similar factors of production and similar productivities,most of their trade is likely to be intraindustry.

Question

Quizplus · Accepted Answer

When two countries have similar factors of production and similar productivities, they are likely to produce and trade similar goods. This results in intraindustry trade, where countries trade goods of the same industry. Therefore, most of their trade is likely to be intraindustry.

If Countries Have Similar Factors of Production and Similar Productivities,most