The reason why most efficient firms in a Melitz industry make greater profits under free trade is due to the fact that they A. Operate under increasing marginal costs. B. Operate under FDI. C. Operate under low transport costs. D. Operate under increasing returns to scale. Explain and include a diagram
The reason why most efficient firms in a Melitz industry make greater profits under free trade is due to the fact that they A. Operate under increasing marginal costs. B. Operate under FDI. C. Operate under low transport costs. D. Operate under increasing returns to scale. Explain and include a diagram
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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The reason why most efficient firms in a Melitz industry make greater profits under free trade is due to the fact that they
A. Operate under increasing marginal costs.
B. Operate under FDI.
C. Operate under low transport costs.
D. Operate under increasing returns to scale.
Explain and include a diagram
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