Which theory emphasizes absolute cost advantage?
Options
ARicardo
BAdam Smith
CHeckscher
DOhlin
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International TradePYQ - May 2018 (Inter)Question 173 of 20
All Questions Correct Answer
✅ Option b — Adam Smith
All Options:
- ARicardo
- BAdam Smith
- CHeckscher
- DOhlin
About This Chapter: International Trade
Paper
Paper 4: Business Economics
Weightage
10%
Key Topics
Theories, Trade Policy, Exchange Rates
This chapter explores trade between nations — why countries trade, the theories of Absolute and Comparative Advantage, Balance of Payments, Exchange Rate systems (Fixed vs Flexible), and India's trade policy including tariffs, quotas, and WTO rules.
View Official ICAI SyllabusExam Strategy Tip
Understand Comparative Advantage theory thoroughly — it's the foundation of international trade. Also focus on the Balance of Payments structure and what causes deficits.
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