International specialization takes place because of______________?
Correct answer: D. All of the above
- A. differences in technology
- B. differences in factor endowments
- C. scale economies
- D. All of the above
Explanation
Specialization can arise from technological differences, unequal factor endowments and economies of scale. Since all three can make trade beneficial, the comprehensive 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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