If We Are to Demonstrate Gains from Trade in the Theory

Multiple Choice

If we are to demonstrate gains from trade in the theory of comparative advantage, it is necessary to assume that:

A) one country must have an absolute advantage in the production of both goods.
B) one country cannot have an absolute advantage in the production of both goods.
C) one country must be considerably larger than the other.
D) a country must be relatively more efficient in the production of one of the goods.
E) factors of production have to be free to move between countries.