Which trade pattern is BEST explained by increasing returns?

Question

Quizplus · Accepted Answer

Increasing returns occurs when the more a firm produces, the lower its costs of production become. This results in goods being able to be produced cheaper and sold at a lower price, making them more competitive in the global market. In the case of Japan exporting cars to Canada and Canada exporting airplanes to Japan, both countries have industries with increasing returns, making it easier for them to compete in the global market. This trade pattern leads to greater specialization and efficiency, as each country can focus on what it does best.

Which Trade Pattern Is BEST Explained by Increasing Returns