-In order to achieve the maximum gains from trade, people should specialize according to
A) absolute advantage.
B) comparative advantage.
C) PPF.
D) property rights.

Question

-In order to achieve the maximum gains from trade, people should specialize according to
A) absolute advantage. 
B) comparative advantage. 
C) PPF. 
D) property rights.

Quizplus · Accepted Answer

Comparative advantage refers to the ability of a country or individual to produce a good or service at a lower opportunity cost than another country or individual. By specializing in the production of goods and services where they have a comparative advantage, countries and individuals can maximize their gains from trade.

-In Order to Achieve the Maximum Gains from Trade, People