Question

5 points QUESTION 11 Trade has no effect on the distribution of incomes within countries in trade relations.

True False

5 points QUESTION 12 Internal economies of scale form the basis for international trade.

True False

5 points QUESTION 13 Economies of scale give rise to international​ trade

True False

5 points QUESTION 14 Preferential trade agreements are welfare improving if they lead to trade diversion.

True False 5 points QUESTION 15 GATT is a more formal organization with larger scope.

True False

Answer 1

Question 11. False because trade has effect on distribution of income within the countries in trade relations. trade also effect the poverty, economic growth and revenue of the government.

Question 12. True because internal economies of scale refers to production at larger scale can achieved at lower cost. so specialization can be leads to international trade.

Question 13. True because existence of the economies of scale also called increasing return to scale. it means more efficient production within the industry which leads product efficiency and provide benefit to all the economies.

Question 14. False because Preferential trade agreements are welfare reducing by diverting trade away from the most efficient global producers in favor of regional partners.

Question 15. False because WTO is formal organisation with larger scope. GATT is a ad-hoc and provisional organisation.