(I)With trade,individuals will be able to use more of their time and resources producing items they can supply economically and less time and resources producing goods that they can supply only at a high cost.
(II)Reductions in trade barriers will expand the productive potential of the economy.
A)I is true,II is false.
B)I is false,II is true.
C)Both I and II are true.
D)Both I and II are false.

Question

Quizplus · Accepted Answer

Both statements are true. The first statement explains the concept of comparative advantage, where individuals specialize in producing goods that they can produce at a lower opportunity cost and trade with others for goods they cannot produce as efficiently. The second statement is based on the economic principle that reducing trade barriers such as tariffs and quotas allows for greater competition, efficiency, and innovation, leading to an expansion of the economy's productive potential.

(I)With Trade,individuals Will Be Able to Use More of Their