Dynamic gains from trade could result from ?
Correct answer: D. All of the above
- A. The stimulus of additional investment spending as market open
- B. Economies of large scale production as markets open
- C. Additional competition made possible by the opening of markets
- D. All of the above
Explanation
Dynamic gains are longer-run benefits of trade, including stronger investment, economies of scale from larger markets, and increased competition. Since all three can result from market opening, the inclusive option is correct.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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