__________ is the cost to a particular country when a group of countries trade a product freely among themselves but maintain common barriers to trade with nonmembers.
A)Trade creation
B)Trade diversion
C)Balance of power
D)Economies of scale
E)Trade deficit

Question

Quizplus · Accepted Answer

Trade diversion occurs when a group of countries trade amongst themselves freely but maintain barriers to trade with non-members. This results in diverting trade away from more efficient producers outside the trade bloc and towards less efficient producers within the bloc. This can lead to higher prices for consumers and lower economic welfare for the country outside the trade bloc.

__________ Is the Cost to a Particular Country When a Group