Question

Assume, for Taiwan, that the domestic price of soybeans without international trade is lower than the world price of soybeans. This suggests that, in the production of soybeans, a.Taiwan has a comparative advantage over other countries and Taiwan will export soybeans. b.other countries have a comparative advantage over Taiwan and Taiwan will export soybeans. c.Taiwan has a comparative advantage over other countries and Taiwan will import soybeans. d.other countries have a comparative advantage over Taiwan and Taiwan will import soybeans

Answer 1

Answer:

a. Taiwan has a comparative advantage over other countries and Taiwan will export soybeans

Explanation:

In the case when the domestic price is less as compared to the world price so here it means the taiwan would have the comparative advantage over the other countries due to this the taiwan would export the soybeans

So as per the given situation, the option a is correct

And, the same should be considered and relevant