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Mutually Beneficial Trade Between Two Countries Is Possible Only as Long

Question 104

Multiple Choice

Mutually beneficial trade between two countries is possible only as long as


A) unit costs of production are the same no matter how many units are being produced
B) marginal costs rise as production increases
C) marginal costs are equal to average total costs
D) one country has an absolute advantage in the production of one good,while the other country enjoys a similar advantage in making another good
E) one country has a comparative advantage in the production of one good,while the other country enjoys a comparative advantage in making another good

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