In addition to the positive welfare effects that free trade has on an economy, there are a variety of other benefits of international trade. Consider the following scenario: Without free trade, Sapphira has market power as a local producer. Once free trade is implemented in the local economy, Sapphira is no longer able to raise its prices above competitive levels. The previous scenario represents which of the following benefits of free trade?A. An enhanced flow of ideas B. Increased competition C. Lower costs through economies of scale D. Increased variety of goods

B. Increased competition

Explanation:

Free trade is an economic policy where there are no restrictions to imports or export of goods and services.

Before the free trade, Sapphira had market power. She could set the price of her products. She would probably set her prices high enough to maximise profits.

Due to free trade which introduces more products to the market, sapphira is no longer able to set her prices as high as she used to. If her price is too high, consumers would not purchase her products.

This is an example of increased competition.

I hope my answer helps you

answer; ///the above statement is (false) .

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.