AFM 131 final exam questions & answers 2023/2024
Country A is an extremely efficient producer of tin. However, its climate and terrain makes it difficult to produce corn. According to the theory of comparative advantage, Country A should:
A. produce both tin and corn in order to remain self...
Country A is an extremely efficient producer of tin. However, its climate and terrain makes it difficult to
produce corn. According to the theory of comparative advantage, Country A should:
A. produce both tin and corn in order to remain self-sufficient.
B. watch the global market to see which product brings the highest price.
C. import the resources needed to produce corn.
D. concentrate its production on tin and buy corn. - ANSWER-D. concentrate its production on tin and
buy corn.
The fee paid to a firm in a licensing agreement that gives another firm the right to manufacture their
product or use its trademark is called:
A) an outsource agreement.
B) a cartel.
C) a royalty.
D) a trading bloc. - ANSWER-C) a royalty.
The difference between money coming into and leaving the country plus money flows from factors such
as tourism and foreign aid is referred to as the:
A)balance of payments.
B)trade deficit.
C)balance of trade
D)balance of money flows. - ANSWER-A)balance of payments.
A major concern voiced by Canadian critics of NAFTA is that it would result in:
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