The best explanation of the gains from trade that david ricardo could provide was to describe only the outer limits within which the equilibrium terms of trade would fall. this is because ricardo's theory did not recognize how market prices are influenced bya. profit patterns. b. demand conditions. c. business expectations. d. supply conditions.

The correct answer is b. demand conditions.

Explanation:

Demand has an indirect influence when it comes to generating competitive advantages. If a group of buyers is demanding, well informed and maintains a critical attitude towards what they offer, companies in that sector will inexorably have to do their best to meet that demand. Or rather, they will be forced to innovate at every new opportunity and will look for new marketing alternatives. In fact, companies can go a little further and try to anticipate what their customers might need in a short or medium term.

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