International trade is driven by ________.

Question

Quizplus · Accepted Answer

International trade is driven by comparative advantage in the production of goods and services. This means that countries specialize in producing goods and services that they can produce at a lower opportunity cost than other countries, and then trade with other countries to obtain goods and services that they cannot produce as efficiently. This results in mutual benefits and improves overall efficiency in the global economy. Absolute advantage, on the other hand, means that a country can produce goods and services more efficiently than any other country, which is not always the case in international trade. Comparative advantage is therefore a more reliable and sustainable driver of international trade.

International Trade Is Driven by ________