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Q. It is probable that trade based on external scale economies can leave a country worse off than it could have been without trade. Illustrate how this could happen.
Answer: One answer is that the terms of trade effects may possibly dominate any other factors.
According to the Linder theory, trade will occur in goods that have overlapping demand. With aid of a graph, illustrate this theory and its implications. Make use of graph
roles of international trade in economic growth of the country
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