6. The idea that countries should produce and sell goods that they produce most effectively

and efficiently, and buy goods that other countries produce most effectively and efficiently,
is known as
A. absolute advantage theory. C. efficiency balanced trade.
B. free trade. D. comparative advantage theory.

7. These days, the leading commercial firms are found in the _______ sector.
A. manufacturing C. service
B. agricultural D. government

8. In global trade, when the difference between money coming into a country from exports
and money leaving a country due to imports or money flows from other factors is
known as the
A. balance of payments. C. balance of trade.
B. trade offset. D. trade deficit.

9. Which statement best characterizes Adam Smith’s concept of the “invisible hand”?
A. Those who don’t work shouldn’t eat.
B. The quest for personal gain works for the common good.
C. When governments fail to regulate, greed conquers all.
D. Markets create money, and money creates demand.

10. Calendula, Inc. sells its herbal teas at a lower price in foreign countries than those
charged to consumers in Calendula’s home nation. In global trade, this is known as
A. freeloading. C. brand infringement.
B. depreciation. D. dumping

my answers are:

6.C
7.C
8.C or D but i think its D
9.B
10.B

6 and 7 >> right

8. D

9. Right

10. I disagree.

http://www.investopedia.com/terms/d/dumping.asp#axzz1kIj43n6i

#10.) Is Dumping

6. The correct answer is D. comparative advantage theory. To understand this concept, one needs to know that countries have different resources, skills, and technologies. The theory suggests that countries should focus on producing goods or services in which they have a comparative advantage, meaning they can produce them more efficiently and effectively compared to other countries. They can then trade or buy goods that other countries produce more effectively and efficiently. This way, both countries can benefit from specialization and trade.

7. The correct answer is C. service. To arrive at this answer, one needs to consider the current trends in the global economy. Manufacturing and agricultural sectors have experienced significant changes due to automation, technological advancements, and outsourcing. Service sectors, on the other hand, have grown and become leading commercial firms, encompassing various industries like finance, healthcare, information technology, tourism, and more.

8. The correct answer is A. balance of payments. Understanding this concept requires knowledge of how international trade affects a country's economy. The balance of payments is a record of all financial transactions between a country and the rest of the world, including exports, imports, financial aid, and investment flows. It consists of two main components: the current account and the capital account. The current account measures the balance of trade in goods (exports minus imports), services, and income, while the capital account measures the flow of financial assets. If a country has more money flowing in than out, it has a surplus, and if it has more money flowing out than in, it has a deficit.

9. The correct answer is B. The quest for personal gain works for the common good. Understanding Adam Smith's concept of the "invisible hand" requires knowledge of his influential book "The Wealth of Nations." According to Smith, individuals pursuing their own self-interest and aiming to maximize profits indirectly benefit society as a whole. By seeking personal gain, individuals are motivated to provide goods and services that meet the needs and demands of others, leading to economic growth and prosperity.

10. The correct answer is D. dumping. To understand this concept, one needs to be familiar with the practices in global trade. Dumping refers to when a company sells its products in foreign markets at a lower price than they charge in their home country, often below cost or below market value. This can be done to gain a competitive advantage, eliminate competition, or penetrate new markets. Dumping is often subject to anti-dumping laws and regulations to protect domestic industries and ensure fair competition.