If there is trade, which of the following is most likely?
A) A country is worse off because it becomes dependent on other countries.
B) A country will produce a greater variety of goods and services to trade.
C) A country's consumption possibilities frontier can be outside its production possibilities frontier.
D) A country will experience a lower unemployment rate.

Question

Quizplus · Accepted Answer

Trade allows a country to consume more than it can produce on its own, effectively shifting its consumption possibilities frontier outward, beyond its production possibilities frontier. This is because trade enables countries to specialize in the production of goods and services in which they have a comparative advantage, and then trade for other goods and services they need or want, thus potentially consuming more or a greater variety of goods and services than they could produce on their own.

If There Is Trade, Which of the Following Is Most