The comparative advantage theory holds that a country will gain from trade even though it can produce all goods more efficiently than other countries.

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The comparative advantage theory states that a country should specialize in and export goods that it can produce relatively more efficiently than other countries, and import goods that other countries can produce relatively more efficiently than itself. This leads to gains from trade for all countries involved, even if one country can produce all goods more efficiently than others.

The Comparative Advantage Theory Holds That a Country Will Gain