Suppose that a nation has an absolute advantage in the production of all goods.In this instance,it
A)has no incentive to engage in international trade
B)is producing at a point on its production possibilities frontier
C)has no unemployment
D)also has a comparative advantage in the production of those goods
E)should specialize in producing the goods for which it has a lower opportunity cost than other countries

Question

Quizplus · Accepted Answer

Even if a nation has an absolute advantage in all goods, it should specialize in producing goods for which it has a comparative advantage, meaning a lower opportunity cost, to maximize gains from trade.

Suppose That a Nation Has an Absolute Advantage in the Production