Is the following statement true or false? According to the theory of comparative advantage, the allocation of resource among countries participating in international trade will return the greatest welfare for all countries.

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According to the theory of comparative advantage, each country is able to produce a product at lower cost when it participates in international trade. The cost of products for each country becomes cheaper compared to the cost a country has to pay without international trade. The allocations of resources are operated in the best possible way that benefits all countries.

Is the Following Statement True or False? According to the Theory