Multiple Choice
Given the information in Question #12 above, suppose that Germany is a much larger Country in terms of production and income than is the United Kingdom. In this situation, Other things equal, when the countries engage in trade, the posttrade price ratio (terms of Trade) would tend to settle __________, and __________ would therefore tend to have Relatively large gains from trade.
A) toward a value of 1 cloth:2 steel; the United Kingdom
B) toward a value of 1 cloth:2 steel; Germany
C) toward a value of 1 cloth:1.5 steel; the United Kingdom
D) toward a value of 1 cloth:1.5 steel; Germany
Correct Answer:
Verified
Correct Answer:
Verified
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