IB Diploma Programme (DP) - SL & HL · Economics

Benefits of international trade: Practice Questions

5 multiple-choice questions marked as you go, and 1 written questions with worked solutions. All on Benefits of international trade.

6 questions7 marksFree, no account

Question 1

1 mark

International trade allows nations to specialize in the production of goods where they have a lower opportunity cost. This process primarily leads to:

Question 2

1 mark

The following table shows the output per unit of labor for two countries, A and B, producing two goods, X and Y.

Country A: Good X = 10, Good Y = 5
Country B: Good X = 8, Good Y = 2

Based on the principle of comparative advantage, which of the following is true?

Question 3

1 mark

A major criticism of the static model of comparative advantage as a justification for the benefits of trade is that it often assumes:

Question 4

1 mark

According to the principle of absolute advantage, what is the primary reason for a country to engage in international trade?

Question 5

1 mark

In the context of international trade, the "transfer of technology" benefit refers to:

Question 6

2 marks

State two major economic benefits that a country derives from engaging in the principle of comparative advantage through international trade.

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