Is it possible for trade to take place in the Classical world of David Ricardo without complete specialization of production in both countries? If so, when? Who will receive the gains from trade in this instance? Why?

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The Answer is Yes, it is possible for trade to take place in the Classical world of David Ricardo without complete specialization of production in both countries. According to Ricardo's theory of comparative advantage, trade can still occur even if one country is not completely specialized in the production of a particular good. This is because each country will still have a comparative advantage in producing certain goods over others, and by trading with each other, they can both benefit from producing and exporting the goods in which they have a comparative advantage.

Trade will occur when the opportunity cost of producing a good in one country is lower than the opportunity cost of producing the same good in another country. In this case, both countries will benefit from trading with each other, as they can obtain goods at a lower opportunity cost than if they were to produce them domestically.

The gains from trade in this instance will be received by both countries involved in the trade. This is because trade allows both countries to consume a greater variety of goods at a lower cost, leading to an increase in overall welfare for both countries. Additionally, trade can lead to increased efficiency and specialization, which can further benefit both countries' economies. Therefore, both countries will receive the gains from trade in this instance.

Is It Possible for Trade to Take Place in the Classical