Indicate whether each of the following statements is true or false. Statement True False

1. Two countries can gain from specialization and trade as long as they have different opportunity costs in the production of some goods.

2. The gains from specialization and trade are based on absolute advantage.

3. If a certain trade is good for one country, it must be good for the other country.

4. Two individuals can benefit from trade even if neither has a comparative advantage in some activity.

5. Workers in importing industries are likely to oppose trade

Indicate whether each of the following statements is true or false. Statement True False

1. True

2. False, the gains from specialization and trade are based on comparative advantages.

3. False, sometimes countries need to trade or are forced to trade, and that doesn't always result in both benefiting from trade or everyone in the country benefiting from trade.

4. True, as long as they have different opportunity costs in the production of some goods.

5. False, workers that are employed in importing companies will favor trade since their whole business is based on trade.