ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
6th Edition
ISBN: 9781337408059
Author: William A. McEachern
Publisher: Cengage Learning
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Chapter 3, Problem 13P
To determine

Reasons as to why international trade occurs and meaning of deficit in the merchandise trade balance

Concept Introduction:

International Trade: The exchange of capital, goods and services beyond the national boundaries of the country is termed as International Trade.

Merchandise Trade Balance: It is the difference between the total imports and exports of the goods of the country.

Opportunity Cost: It is the cost in terms of the forgone benefit that a person could have received by choosing an alternative course of action.

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