The idea of comparative advantage implies that people or countries
A) can gain from trading.
B) should specialize in the production of goods.
C) can consume at a point outside their production possibilities frontier.
D) all of the above

Question

Quizplus · Accepted Answer

The idea of comparative advantage suggests that countries or individuals can benefit from trading with one another by specializing in the production of goods and services that they are relatively good at producing, while importing goods and services that they are relatively less efficient at producing. This can lead to increased consumption beyond what would be otherwise possible within their own production possibilities frontier. Therefore, all of the above options are correct.

The Idea of Comparative Advantage Implies That People or Countries