Economic restructuring that takes place as a result of opening to trade with other countries
A)contradicts the idea of gains from trade.
B)causes some trading activity to be zero sum.
C)worsens the nation's allocation of resources.
D)improves the nation's allocation of resources.

Question

Quizplus · Accepted Answer

Economic restructuring that takes place as a result of opening to trade with other countries improves the nation's allocation of resources. This is because trade increases the efficiency of resource allocation and promotes specialization, allowing countries to focus on producing goods and services that they can produce most efficiently while importing goods and services that they cannot produce as efficiently. The result is a more efficient allocation of resources within the economy. Therefore, economic restructuring resulting from trade is not contradictory to the idea of gains from trade. Moreover, trade can lead to positive-sum outcomes, with both trading partners benefiting from the exchange.

Economic Restructuring That Takes Place as a Result of Opening