The law of comparative advantage suggests that

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The law of comparative advantage suggests that countries should specialize in the production of goods in which they have a lower opportunity cost and trade with other countries for goods in which they have a higher opportunity cost. In this case, if Slavia has a lower opportunity cost for producing clothing and Italia has a lower opportunity cost for producing food, it would be beneficial for Slavia to trade clothing for Italia's food and for Italia to trade food for Slavia's clothing. Therefore, both countries could gain if Slavia traded food for Italia's clothing. Choice A is incorrect because the law of comparative advantage suggests that at least one country would gain from trade. Choice B is incorrect because the law of comparative advantage suggests that trade can be mutually beneficial. Choice C is incorrect because it assumes that Italia has a comparative advantage in producing clothing, which is not given in the scenario.

The Law of Comparative Advantage Suggests That