Underlying most of the trade theories discussed is the notion that:

Question

Quizplus · Accepted Answer

The concept of comparative advantage, which is the basis for most trade theories, suggests that different countries have particular advantages in certain industries or activities. This leads to specialization and trade between countries, with each country focusing on producing the goods or services in which it has the comparative advantage.

B) is not correct because while first-mover advantage can provide temporary benefits, it does not necessarily guarantee long-term dominance in global trade.

C) is also not correct because while there may be advantages to consolidating production in one country, there are also potential drawbacks related to factors such as transportation costs, political risk, and supply chain disruption.

D) is not correct because businesses can and often do influence government trade policy through lobbying, advocacy, and other means.

Underlying Most of the Trade Theories Discussed Is the Notion