A key limitation of mercantilist trade theory is its focus on:

CA Foundation · Business Economics · MTP · May 2026
A key limitation of mercantilist trade theory is its focus on:
(A) A. Balance of trade rather than overall welfare
(B) B. Comparative cost differences
(C) C. International capital flows
(D) D. Factor proportions

Suggested Answer and Working Notes:

Correct Answer: Option (A)

A. Balance of trade rather than overall welfare

Topics: International Trade

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