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Commerce · Q372

Business Environment and International Business

Graduate and Post Graduate · Commerce · question 372

Q372

In the two good Ricardian Trade Model, complete specialization in production occurs in fee trade equilibrium because

A.
the production possibility frontier satisfies increasing opportunity cost
B.
there are diminishing returns to the factor of production
C.
there are increasing returns to the factor of production
D.
the production possibility frontier satisfies constant opportunity cost
Answer

Answer: Option D

Solution

Answer: Option D
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