The principle of comparative advantage is that total output will be greatest when each good is produced by that nation which has the lowest domestic opportunity cost.

Question

Quizplus · Accepted Answer

This statement accurately reflects the principle of comparative advantage, which states that countries should specialize in producing the goods they can produce at a lower opportunity cost and trade with other countries for goods they cannot produce as efficiently. This leads to increased overall production and efficiency.

The Principle of Comparative Advantage Is That Total Output Will