The main cause of different relative costs between countries are ?
Correct answer: D. relative factor endowments
- A. relative factor competition
- B. relative factor mobility
- C. relative factor substitution
- D. relative factor endowments
Explanation
Countries have different relative costs mainly because they possess different relative quantities of land, labour, capital and other productive resources. These differences in factor endowments create comparative advantage.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Microeconomics
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.
Practise Microeconomics
1,742 free Microeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Microeconomics questions
The imposition of a tariff causes consumption to _____ and imports to _________?
An optimal tariff is one which reduces imports to the level at which ____ equals ____?
Import substitution is the replacement of ____ by domestic production _____ protection of ________?
International specialization takes place because of______________?
Free trade is based on the principle of ?
Which of the following is not an argument for protectionism ?