Producers who have absolute advantages in all goods:
A) cannot exist.
B) have no use for trade.
C) are better off specializing in their comparative advantages and trading for other goods.
D) should avoid the global division of labor because it is counterproductive for them.

Question

Quizplus · Accepted Answer

Even if a producer has an absolute advantage in all goods, it is still more efficient for them to specialize in the goods in which they have a comparative advantage and trade for other goods. This allows both parties to benefit from the potential gains from trade. Therefore, choice C is the best answer.

Producers Who Have Absolute Advantages in All Goods