If the output of a nations exportable commodity increases proportionally more than the output of its importable commodity the output changes in considered

Question

Quizplus · Accepted Answer

When the output of a nation's exportable commodity increases proportionally more than the output of its importable commodity, it means that the nation has a comparative advantage in producing the exportable commodity. This leads to a pro-trade outcome, where the nation can trade its surplus of the exportable commodity for goods that it has a comparative disadvantage in producing. This increases overall efficiency and welfare for both trading partners. Therefore, the correct choice is D - pro-trade.

If the Output of a Nations Exportable Commodity Increases Proportionally