According to the Classical theory of international trade ?
Correct answer: D. All of the above are false
- A. Only countries with low wages will export
- B. Only countries with high wages will import
- C. Countries with high wages will have higher prices
- D. All of the above are false
Explanation
Classical trade theory explains trade through productivity and opportunity-cost differences, not simply through national wage levels or price levels. Therefore none of the first three wage-based statements is generally valid.
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