When a country participates in international trade,its consumption possibilities
A)Must still equal its production possibilities.
B)May increase,but its trading partners consumption possibilities will decrease.
C)Will increase if it is a rich country and will decrease if it is a poor country.
D)Always exceed its production possibilities.

Question

Quizplus · Accepted Answer

When a country engages in international trade, it can specialize in producing goods for which it has a comparative advantage and then trade those goods for others it needs, effectively allowing it to consume more than it could if it only relied on its own production. This means its consumption possibilities exceed its production possibilities.

When a Country Participates in International Trade,its Consumption Possibilities