Related to the Economics in Practice on page 663: Trade ________ comparative advantage of countries and ________ the efficiency of firms.
A) exploits; improves
B) exploits; reduces
C) inhibits; improves
D) inhibits; reduces

Question

Quizplus · Accepted Answer

Trade exploits the comparative advantage of countries by allowing them to specialize in the production of goods and services they can produce most efficiently. This specialization and exchange improve the overall efficiency of firms by enabling them to focus on their strengths and benefit from economies of scale.

Related to the Economics in Practice on Page 663: Trade