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Theoretically, trade between two countries takes place on account of
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- differences in costs
- scarcity of goods
- comparative differences in costs
- need for exports
Correct Option: C
Trade exists for man due to specialization and division of labor, most people concentrate on a small aspect of production, trading for other products. Trade exists between regions because different regions have a comparative advantage in the production of some tradable commodity, or because different regions' size allows for the benefits of mass production thus providing cost advantage of producing the same commodity.
