Mill's theory of reciprocal demand is based on one of the assumptions that
A)There is less than full employment
B)There is imperfect competition
C)The commodities are produced under the law of constant returns
D)There are transport costs involved

Question

Quizplus · Accepted Answer

Mill's theory of reciprocal demand, part of international trade theory, assumes that commodities are produced under the law of constant returns. This means that doubling the inputs will double the outputs, keeping the cost per unit constant.

Mill's Theory of Reciprocal Demand Is Based on One of the Assumptions