The gains or benefits from trade are:
A) A result of more efficient resource utilization.
B) based on different wage rates in different countries.
C) greater when rich nations trade with poor nations.
D) based on the principle of absolute advantage.

Question

Quizplus · Accepted Answer

The gains or benefits from trade are a result of more efficient resource utilization. This means that countries can specialize in the production of goods and services in which they have a comparative advantage and trade with other countries for goods and services in which they have a comparative disadvantage. This results in more efficient use of resources and leads to increased productivity, higher output, and increased consumption for all trading partners.

The Gains or Benefits from Trade Are