Assertion (A): Free international trade necessarily lowers the real wage of the scarce factor of production in terms of any good.
Reason (R): If the real wage declines in terms of every good, real income must suffer regardless of the tastes and expenditure patterns of the labourer as consumers.

A) Both A and R are true and R is the correct explanation of A B) Both A and Rare true but R is NOT a correct explanation of A C) A is true but R is false D) A is false but R is true

Answer & Solution

Correct Answer: Option A

Let's discuss the solution. Join the discussion

Question posted by Examveda

Community

Join the Discussion

Join the discussion

No comments yet Be the first to discuss this question.

Keep Learning

Assertion (A) Free international trade necessarily lowers the real wage of...

Assertion (A): Free international trade necessarily lowers the real wage of the scarce factor of production in terms of any good. Reason (R): If the real wage declines in terms of every good, real income must suffer regardless of the tastes and expenditure patterns of the labourer as consumers.

Join the Discussion

Related Questions on Business Environment and International Business

Assertion (A): Free international trade necessarily lowers the real wage of the scarce factor of production in terms of any good.
Reason (R): If the real wage declines in terms of every good, real income must suffer regardless of the tastes and expenditure patterns of the labourer as consumers.