Economic Integration (id: 516de7222)

本题目来源于试卷: Economic Integration，类别为 IB经济学

[单选题]
After joining a trading bloc with commi4uwda5; -ba von ex )eod qwdb: yc)+3un ghgr/o,-ternal barriers, production shifts from a low-cost producer to a high-cost producer.h:,y3gdr q-)odbg en/ow+u) c This is an example of

A. trade diversion
B. trade creation
C. comparative advantage
D. increased competition


参考答案:  A


本题详细解析:

A

$\underset{‾}{\text{Explanation}}$:
Trade diversion happens when the formation of a trading bloc shifts production from a low-cost producer to a high-cost producer. For example, joining a customs union can require a common external tariff, raising the price of imports from low-cost producers. As a result, trade diverts to higher cost members of the customs union.

Choice B is incorrect because trade creation happens when the entry of a country into a trading bloc shifts production from a high-cost producer to a low-cost producer.

These answer choices do not specifically address the impact of joining trading blocs:

• Choice C refers to comparative advantage which is the reason production costs are high or low. It does not explain why production shifts from one producer to another.

• Choice D refers to increased competition, but production moving from low-cost to high-cost producers results from reduced competition.

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