Which of the following phenomena cannot be explained by the simple comparative advantage theory?
A) A country that does not have much farmland tends to import agricultural goods.
B) A country with a lot of skilled labor tends to export highly technical goods.
C) A country tends to export the goods that it can produce at a lower opportunity cost.
D) A country imports and exports the same goods.

Question

Quizplus · Accepted Answer

The simple comparative advantage theory explains trade based on the relative efficiency of producing goods, but it does not directly account for the phenomenon of countries importing and exporting the same goods, which can be due to factors like differences in product varieties, quality, or seasonal production differences.

Which of the Following Phenomena Cannot Be Explained by the Simple