Argentina and Chile both produce copper and timber. If Chile produces copper much more efficiently than Argentina and timber slightly more efficiently than Argentina, _____ can benefit from trading copper and timber with each other.

Question

Quizplus · Accepted Answer

Both countries can benefit from trading because Argentina can trade its timber with Chile for copper, which Chile produces more efficiently. This allows both countries to specialize in their comparative advantage and have access to a greater variety of goods.

Argentina and Chile Both Produce Copper and Timber