The law of comparative advantage indicates that
A) a group of people will reduce their output when each good or service is supplied by the low opportunity cost producer.
B) trading partners lose when they can acquire a good through trade cheaper than they can produce it.
C) trade is most effective when people trade only among those in their own nation.
D) a group of people can increase their output when each good or service is supplied by the low opportunity cost producer.

Question

Quizplus · Accepted Answer

The law of comparative advantage suggests that overall output increases when each good or service is produced by the entity with the lowest opportunity cost, allowing for more efficient allocation of resources.

The Law of Comparative Advantage Indicates That