Country A exports electronic goods from Country B although there are no underlying differences in factor endowments between the two countries. Which of the following theories explains this anomaly?

Country A exports electronic goods from Country B although there are no underlying differences in factor endowments between the two countries. Which of the following theories explains this anomaly? 










A. Comparative advantage theory

B. New trade theory

C. Ricardo's theory

D. Smith's theory












Answer: B