Why do people often choose to specialize and trade?
A) It allows them to enjoy more goods than they can create on their own.
B) They can consume a bundle of goods on their production possibilities frontier.
C) It allows them to always produce at a point beyond their own production possibilities frontier.
D) They can take advantage of another nation's poor choices.

Question

Quizplus · Accepted Answer

Specialization and trade allow individuals to enjoy a greater variety of goods than they would be able to produce on their own. By focusing on producing goods in which they have a comparative advantage, individuals can exchange those goods for other goods that they are less efficient at producing. This leads to a mutually beneficial outcome for both parties involved in the trade.

Why Do People Often Choose to Specialize and Trade