To gain from trade, a country should

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Quizplus · Accepted Answer

To gain from trade, a country should specialize in producing the goods for which it has a comparative advantage, meaning it can produce the good at a lower opportunity cost than other countries. By specializing and trading with other countries, a country can consume more goods than it could if it produced everything domestically. Trying to always get a favorable tariff or only trading with political allies can limit a country's potential trade opportunities and potentially harm its economy. Specializing in the commodity for which it has an absolute advantage can also be limiting if the country's absolute advantage is in a good that it cannot produce enough of to meet domestic demand or if other countries have a higher absolute advantage in producing that good.

To Gain from Trade, a Country Should