What occurs when a person possesses a comparative advantage in the production of one good or service?
A) It promotes greater self-sufficiency.
B) It permits gains from trade to be realized due to a more efficient use of resources.
C) It discourages specialization.
D) The person's opportunity cost becomes higher than for that of other goods.

Question

Quizplus · Accepted Answer

When a person possesses a comparative advantage in the production of one good or service, it means that they can produce that good or service at a lower opportunity cost than another person or country. This allows for a more efficient use of resources and the ability to specialize in the production of that good or service, which in turn leads to gains from trade. Therefore, choice B is the correct answer.

What Occurs When a Person Possesses a Comparative Advantage in the Production