Question

8.
Which of the following consequences of comparative advantage would lead workers to emigrate and find jobs in a neighboring country?

Select TWO correct answers.

Select A
An industry causes flooding that destroys people's homes and businesses. Everyone must move to find a new home and job.

Select B
Various imports from neighboring countries give consumers access to products that could not be produced in their own country.

Select C
Specialization leads to higher economic growth rates and many people can buy more than those in previous generations.

Select D
Economic competition among countries contributes to the development of better products for consumers.

Select E
Industries that cannot compete with cheaper imports from a neighboring country must lay off workers.

...
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Answer 1

Correct answers: B and E.

- E: Cheaper imports can force domestic firms to shut down or lay off workers — a direct reason for those workers to seek employment abroad.
- B: When goods are produced in a neighboring country (because of comparative advantage), production — and therefore jobs — move there; consumers gain access to those imports, and displaced or job-seeking workers may emigrate to where the jobs are.