If producers have different opportunity costs of production, trade will allow them to consume outside their production possibility frontiers.

Question

Quizplus · Accepted Answer

Trade allows producers to specialize in the goods and services they have a comparative advantage in producing, which means they can produce those goods and services at a lower opportunity cost compared to others. By trading with others who have different opportunity costs, they can consume outside their own production possibility frontiers and enjoy a higher standard of living.

If Producers Have Different Opportunity Costs of Production, Trade Will