Kenya produces some of the finest teas much of which it exports. Its climate is not so suited to producing olives but the olives can be sold for a higher price per sack.
What would definitely happen if a Kenyan company used some of the land where tea is grown to plant olive trees?
1 )
The company would have a comparative advantage in trade.
2 )
The company’s revenue would increase.
3 )
There would be a decrease in the credit side of the trade in goods and services.
There would be an opportunity cost from lost tea production.
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