Intra-industry trade (IIT):
A) is nothing but a trivial data problem.
B) can be analyzed in exactly the same way we analyzed interindustry trade.
C) has nothing to do with trade in differentiated products.
D) can be related to the existence of overlapping demands.
E) does not occur between developed and developing countries.

Question

Quizplus · Accepted Answer

Intra-industry trade (IIT) refers to the exchange of similar, but differentiated, products between countries, which can be attributed to overlapping demands in those countries for specific types of goods, even within the same industry. This is why option D is correct.

Intra-Industry Trade (IIT)