It allows nations to specialise in the production of those products where they have a comparative advantage

It leads to greater economic equity amongst nations

Distortions or externalities are reduced or eliminated

It provides higher wages and greater employment opportunities for manufacturing workers in the Developed world

Product differentiation

None of the above

Historical patterns

Monopolistic competition 

Import-competing industries

Domestic products

Exporting businesses

Importing businesses

The nation can produce outside of its production possibilities curve, albeit in the short run only

Production factors are directed to their highest productivity

Unemployment is reduced 

The output of the nation's trading partner declines

Costs are higher in one country than in another

Prices are lower in one country than in another

Exports provide a political advantage to nations with a current account surplus

The productivity of capital labour differs across countries and industries

High wages paid to foreign workers than domestic workers

Greater access to different goods and services 

The exporting country behaving as a monopoly

The economies of scale resulting from a larger market

International trade is a zero-sum exercise

The promotion of export generating industries should be a government priority

Imports are undesirable

Governments policy should include import substitution policies 

Customs union

Red tape barriers

Quotas

Tariffs

Red tape barriers

Export subsidies

Customs union

Tariffs

Boundaries between tradable and non-tradable goods

All of the above

Patterns of trade

Global supply chains

Resources are unequally distributed amongst different nations

Nations have different rates of Interest and currency

Trade enhances opportunities to accumulate profits

Some nations prefer to produce one thing while others produce other things

Countries reducing income tax and corporation tax rates

The dilution of international business laws & conditions between countries

Perfectly competitive markets between countries and other special regions

Countries specialising in the production of goods and services they are most suited for

Customs unions are internal only so trade from outside the bloc is not permitted

Customs unions relate to specific goods and services only and not all products traded

Common external import barriers

Customs unions also include the ability of factors of production to move between borders

Customs unions also include the ability of factors of production to move between borders

PTAs relate to specific products only and not all goods and services traded

PTAs reduce barriers on goods and services traded but do not eliminate them

PTAs are internal only so trade from outside the bloc is not permitted

When production is diverted from less efficient producers to more efficient ones

When trade is diverted from one part of a trade bloc to another

When production is diverted from high cost producers to low cost producers

When production is diverted from low cost producers to high cost producers

When production is diverted from less efficient producers to more efficient ones

When production is diverted from high cost producers to low cost producers

When production is diverted from high cost producers to low cost producers

When trade is diverted from one part of a trade bloc to another

Common market

Monetary union

Customs union

Political union

Common market

Customs union

Financial union

Free trade area

Reduced economies of scale through increased trade

Higher shoe leather costs when business change their menus and prices

Higher tariff barriers on products arriving from outside the trading bloc

Trade diversion as nations are forced to purchase goods and services from within the bloc rather than lower cost producers

Absolute advantage arises when a nation is able to produce a good or service more efficiently than another product, where as comparative advantage means they can produce some products more efficiently than others

Absolute advantage arises when a nation is able to produce all goods and services more efficiently than another nation, where as comparative advantage means they can produce only some products more efficiently

Absolute advantage arises when a nation is able to produce a good or service more efficiently than another nation, where as comparative advantage means they can produce some products at a lower opportunity cost than another nation

Absolute advantage arises when a nation is able to produce a good or service more efficiently than another nation, where as comparative advantage means they can produce some products more efficiently than others