The classic theory of comparative advantage suggests that each country should ________.
A) attempt to maintain a trade surplus by exporting more than what it imports
B) attempt to maintain a trade deficit by importing more than what it exports
C) produce all goods and services it requires for domestic consumption
D) specialize in those areas where it can produce more efficiently than other countries
E) produce a wide range of products to maintain an attractive international portfolio

Question

Quizplus · Accepted Answer

A)The classic theory of comparative advantage suggests that each country should specialize in those areas where it can produce more efficiently than other countries, and it should trade for goods and services that it can't produce as economically.
B)The classic theory of comparative advantage suggests that each country should specialize in those areas where it can produce more efficiently than other countries, and it should trade for goods and services that it can't produce as economically.
C)The classic theory of comparative advantage suggests that each country should specialize in those areas where it can produce more efficiently than other countries, and it should trade for goods and services that it can't produce as economically.
D)The classic theory of comparative advantage suggests that each country should specialize in those areas where it can produce more efficiently than other countries, and it should trade for goods and services that it can't produce as economically.
E)The classic theory of comparative advantage suggests that each country should specialize in those areas where it can produce more efficiently than other countries, and it should trade for goods and services that it can't produce as economically.

The Classic Theory of Comparative Advantage Suggests That Each Country