A country will specialize in the good for which
A) it has absolute advantage.
B) it has moderate production costs.
C) it can produce at minimum average cost.
D) it has comparative advantage.

Question

Quizplus · Accepted Answer

The concept of comparative advantage suggests that a country should specialize in the production of a good or service for which it has the lowest opportunity cost of production. This means that the country has the ability to produce the good or service at a lower cost than another country, even if it does not have an absolute advantage in producing it. Therefore, the best choice is D, which states that a country will specialize in the good for which it has comparative advantage.

A Country Will Specialize in the Good for Which