Sentoria is an island nation in the Pacific ocean.It's geographical location is advantageous since it has access to a variety of aquatic life forms and also a number of fresh water sources that provide for fisheries.The lack of arable land drives local demand for seafood.The competition in the domestic fishing industry is fierce and enables Sentoria to be one of the major exporters of seafood.Which of the following theories of international trade best explains Sentoria's dominance as an exporter of seafood?

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Quizplus · Accepted Answer

The Theory of National Competitive Advantage, also known as the Diamond Theory, emphasizes the importance of a country's developed factors of production, related and supporting industries, demand conditions, and firm strategy, structure, and rivalry in determining its competitive advantage in a particular industry. In the case of Sentoria, its access to aquatic life forms and fresh water sources contribute to its developed factors of production, while its domestic demand for seafood drives innovation and competition among firms. This creates a favorable environment for Sentoria's seafood industry to be globally competitive and dominant in exports.

Sentoria Is an Island Nation in the Pacific Ocean