When countries specialize in producing those goods in which they have ________, they maximize their combined output and allocate their resources more efficiently.
A) an absolute advantage
B) a comparative advantage
C) a greater demand
D) export subsidies from the government

Question

Quizplus · Accepted Answer

Countries maximize their combined output and allocate resources more efficiently by specializing in the production of goods for which they have a comparative advantage. This means they produce goods at a lower opportunity cost compared to other countries, rather than focusing on goods for which they have the absolute highest productivity or output.

When Countries Specialize in Producing Those Goods in Which They