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The reasons that nations trade includes the fact that:

A. no one country produces all of what citizens within the country want.
B. the wants of their citizens exceeds their productive capacity.
C. different countries have different levels of greed.
D. labor costs are too high in some countries to efficiently produce goods.

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Sonal Bahl
Sonal BahlLv10
2 Apr 2021
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Related questions

Trade allows countries to use national resources more efficiently and enables industries and workers to be more productive. Trade may even allow countries to achieve higher living standards and keep the cost of many everyday products low. Without international trade, most nations would be unable to feed, clothe, and house their citizens at current levels. In fact, some types of food would become unavailable, or obtainable only at very high prices. For example, in Brazil, where coffee beans and sugar cane are readily available, prices on these items would remain low. However, coffee and sugar could become luxury items in countries such as Canada.

For this discussion activity, respond to the following prompts:

Choose one item that is internationally traded (other than the example presented) and hypothesize what would happen if this item were no longer internationally traded.

Identify who has this product, describe how it is currently used, what its current benefit is, and what happens if it is now unavailable.

Be creative with the product you select; it does not have to be an everyday, common product! (300 Words Minimum)

Mention if the following statements are true or false. Explain clearly why, using ideas and concepts.

a. Under free trade, one country gains at the expense of the other.

b. The theory of comparative advantage states that free trade benefits all countries.

c. The Neo-classical trade theory states that trade arises due to different amounts of labor and capital in a country.

d. The H-O theory states that trade arises due to different PPFs in a country.

e. Under free trade, prices fall, so trade becomes easier.

f. A country should not have any imports and should increase exports if it wants to increase its employment levels.

g. Adam Smith recommended very strong government regulation of trade.

h. A country with higher labor productivity than another country will have a comparative advantage in the production of all goods.

i. The Theory of absolute advantage explains producer and consumer equilibriums under free trade.

j. Developed countries do not gain under free trade with developing countries.

all of the following are reasons for countries to participate in foreign trade except:

a) no nation can produce all of the products its people want and need.
b) some nations have resources, but not technological know-how; while others have know-how, but lack resources.
c) even if a country were self-sufficient, other nations would seek to trade with that country in order to meet the needs of its own people.
d) it is just as easy to start a business overseas as it is in the U.S.

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