Comparative advantage in international trade:

Question

Quizplus · Accepted Answer

Comparative advantage is used to determine whether trade will be beneficial to both countries involved, as it allows countries to specialize in the production of goods and services in which they have a lower opportunity cost, leading to increased efficiency and productivity in both countries involved in the trade. It is not limited to large or developed countries, and it does not dictate what goods countries should produce.

Comparative Advantage in International Trade