Which among the following are the major assumptions of Absolute advantage theory? | Faculties

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Rakesh Kumar

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📊 International Economics

Q. Which among the following are the major assumptions of Absolute advantage theory?

(A) there are two countries and two commodities and one country has absolute advantage in one commodity and the second country has advantage in another commodity.
(B) labour is the only factor of production and labour is homogeneous, that means each unit of labour produces same level of output. value of a commodity is measured in terms of its labour content
(C) labour is perfectly mobile within the country but perfectly immobile between the countries. it means that workers are free to move between industries within the nation but migration to other countries is impossible.
(D) all the above.

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✅ Correct Answer: (D) all the above.

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