Which of the following most accurately states the economic significance of exchange?
A) Physical goods have value because they exist; exchange can neither increase nor decrease their value.
B) Exchange creates value by permitting trading partners to expand total output as the result of specialization in areas where they have a comparative advantage.
C) Exchange creates value by moving goods from people who value the goods less to people who value the goods more.
D) Both b and c are true.

Question

Quizplus · Accepted Answer

Exchange creates value by allowing specialization and comparative advantage (B) and by reallocating goods to those who value them more (C).

Which of the Following Most Accurately States the Economic Significance