Why is trade an important source of economic progress?
A) It allows the trading partners to produce a larger joint output through specialization in the areas where they have a comparative advantage.
B) It allows the trading partners to produce a larger joint output as the result of greater realization of cost reductions that accompany the adoption of mass production methods.
C) It makes it possible to realize gains from the discovery and dissemination of innovative products and production processes.
D) All of the above are correct.

Question

Quizplus · Accepted Answer

Trade is important for economic progress because it enables specialization based on comparative advantage, allows for cost reductions through mass production, and facilitates the spread of innovations.

Why Is Trade an Important Source of Economic Progress