In the context of international trade, the theory of comparative advantage was propounded by:
A. Adam Smith
B. Heckscher and Ohlin
C. David Ricardo
D. Paul Krugman
Answer: Option C
Solution (By JKSSB Mock Tests)
David Ricardo developed the theory of comparative advantage, which states that countries should specialise in producing goods in which they have a lower opportunity cost.
Explanation:
Average Propensity to Consume (APC) = Total Consumption / Total Income. Marginal Propensity to Consume is the change in consumption divided by the change in income.
Explanation:
Tax incidence refers to the final resting place of the tax burden — who ultimately bears the economic burden of the tax after possible shifting.
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