When countries specialize in producing those goods in which they have a comparative advantage, they
A) maximize their combined output, but they do not necessarily allocate their resources more efficiently.
B) maximize their combined output and allocate their resources more efficiently.
C) allocate their resources more efficiently, but they do not necessarily maximize their combined output.
D) do not necessarily maximize their combined output, and they also do not necessarily allocate their resources more efficiently.

Question

Quizplus · Accepted Answer

When countries specialize based on comparative advantage, they produce goods and services at a lower opportunity cost than others. This specialization allows for increased efficiency in the allocation of resources and maximizes the combined output of the countries involved, as they can trade to obtain goods and services they do not produce as efficiently.

When Countries Specialize in Producing Those Goods in Which They