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Which of the Following Statements Is True

Question 37

Multiple Choice

Which of the following statements is true ?


A) Specialization and trade along the lines of comparative advantage allows nations to consume more than if they were to produce just for themselves.
B) Free trade theory suggests that when trade takes place any gains made by one nation comes at the expense of another.
C) According to the theory of comparative advantage, a nation should specialize in the production of those goods for which it has an absolute advantage.
D) One country can have the comparative advantage in both goods, but it can only have the absolute advantage in one good as long as the opportunity costs are different.

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