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LenaWriter [7]
2 years ago
13

(50 POINTS!) There is a country that naturally grows the most bananas, but it can't efficiently produce and distribute those ban

anas throughout the global market. However, a country that not only can grow bananas, but also has the infrastructure to process and distribute them, has the _______________. Why?
A. absolute advantage. This is because it has a lower opportunity cost to begin exporting bananas.

B. comparative advantage. This is because it has a lower opportunity cost to begin exporting bananas.

C. comparative advantage. This is because the nation imports less than the other.

D. ability to export. This is because the nation imports less than the other.
Business
1 answer:
NARA [144]2 years ago
3 0
The answer to this question is b
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eimsori [14]

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The correct answer is letter "B": improve; rise.

Explanation:

Terms of Trade measures the efficiency of a country's trade. It is a ratio which compares the exports of a country with its imports. It is <em>calculated by dividing the export value by the import value, and by multiplying the result by one hundred (100)</em>. A terms of trade figure higher than 100, means a country exporting goods at a higher value than its imports.

<em>Given the case that there is no willingness to trade in an economy after a growth, the most possible scenario to take place is that the trade terms will </em>improve <em>as a result of the decrease in the demand of imports and assuming the level of exports keeps at the constant level that allowed the economic growth or if it even </em>rises<em>.</em>

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