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What considerations might limit the extent to which the theory of comparative advantage is realistic?Answer: The theory of relative advantage was initially advanced by the nineteenth century economist David Ricardo as a description for why nations trade with one another.The theory claims which economic well-being is improved if each country’s citizens generate what they have a comparative advantage in generating relative to the citizens of other countries, and after that trade products. Fundamental the theory is the assumptions of free trade among nations and that the factors of production (labor, technology, land, buildings, and capital) are comparatively immobile. To the extent that these types of assumptions do not hold, the theory of comparative advantage will not practically describe international trade.
A firm requires a clear policy regarding as to whether the credit should be authorized to a customer and if yes to what extent. Credit principles are set for making such decisions.
Fixed Costs The costs a rigid incurs doing business that do not change in relation to production. Rent, for example, is a fixed cost because it remains constant whether product
Aggregates Method Under the aggregates method of constructing an index number, we could have unweighted aggregates index and the weighted aggregates index. Unweighted Aggr
Question. 1 Using D to assess the interest rate risk of a financial institution's balance sheet Background: Point 1. A business is 'insolvent' when it has negative eq
Question: Susan started her current job at age 30, with the normal retirement age at 60. The remuneration package of her employment includes the following benefits on top of he
Q. What are the Motives of Holding Cash? Motives of Holding Cash: - In every business assets are kept for the reason that they generate profit. But cash is an asset which doesn
These debentures are backed by integrity and creditworthiness. They do not have any specific collateral backing. Therefore, the ability of the issuing GSE to gene
Q. Is Conservatism an investment strategy? Conservatism - An investment strategy aimed at long-term capital appreciation with low risk; moderate; cautious; opposite of aggressi
Illustration The monthly yield of a mortgage backed security is 0.75%. Find out the annual yield for this security. Solution Annual yield = 2 [(1 + 0
The minimum interest rate which investors demand for non-treasury securities is represented by the yield offered on the treasury securities. This is why market particip
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