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All of the following are reasons for countries to participate in foreign trade except: Multiple Choice it is just as easy to start a business overseas as it is in the U.S. some nations have resources, but not technological know-how; while others have know-how, but lack resources. even if a country were self-sufficient, other nations would seek to trade with that country in order to meet the needs of its own people. no nation can produce all of the products its people want and ne

Respuesta :

Answer:

it is just as easy to start a business overseas as it is in the U.S.

Explanation:

Foreign trade is the exchange of goods and services across international borders.

For example, if a car is bought from china and brought into the US, foreign trade has occurred.

Foreign trade has two components :

  • import
  • export

export would comprise of goods and services produced in the US that are been sold to foreign countries

Import would comprise of foreign produced goods and services that are been sold in the US

Reasons for participating in foreign trade

  1. According to economic theory, a country should specialise in the production of good for which it has a comparative advantage and import goods for which it does not have a comparative advantage in its production . A country has comparative advantage in production if it produces at a lower opportunity cost when compared to other countries.
  2. Some countries do not have the resources needed to produce all the goods needed e.g. some countries do not have crude oil and would have to import from oil producing countries
  3. For most countries, it is impractical to produce all the goods they need.