Senator Smart, who understands economic principles, is trying to convince workers in her district that trade with other countries is beneficial. Senator Smart should argue that trade can be beneficial
A) only if it allows us to obtain things that we couldn't make for ourselves.
B) because it allows specialization, which increases total output.
C) to us if we can gain and the others involved in the trade lose.
D) in only a limited number of circumstances because others are typically self-interested.

Question

Quizplus · Accepted Answer

Senator Smart should argue that trade is beneficial because it allows for specialization, which increases total output. By allowing countries to produce what they are most efficient at, trade allows for greater overall productivity and a higher standard of living for all involved. Option A is incorrect because trade can also be beneficial if it allows countries to obtain goods more efficiently or at a lower cost. Option C is incorrect because trade is most beneficial when it is mutually beneficial, not when one party gains at the expense of the other. Option D is incorrect because while it is true that countries are often self-interested, trade can still be mutually beneficial under the right circumstances.

Senator Smart, Who Understands Economic Principles, Is Trying to Convince