Suppose rice can be produced in country X at a lower cost than in country Y, while tuna can be produced in country Y at a lower cost than in country X. International competition will:

Question

Quizplus · Accepted Answer

International competition will lead to specialization in which countries produce the goods that they can make at a lower cost. In this case, country X will specialize in producing rice while country Y will specialize in producing tuna. This will lead to more efficient global production and lower prices for both goods.

Suppose Rice Can Be Produced in Country X at a Lower