For ________, there is a range of exchange rates that can lead automatically to both countries realizing the gains from specialization and comparative advantage.
A) any pair of countries
B) very few countries
C) only industrialized countries
D) only democratic countries

Question

Quizplus · Accepted Answer

The theory of comparative advantage suggests that any pair of countries can benefit from trade by specializing in the production of goods for which they have a comparative advantage, regardless of their level of industrialization or political system. This implies that there is a range of exchange rates that can facilitate such trade benefits for any pair of countries.

For ________, There Is a Range of Exchange Rates That