If there is no trade, which of the following is most likely?
A)A country is better off because it will become self-sufficient.
B)A country's production possibilities frontier is also its consumption possibilities frontier.
C)A country can still benefit from international specialization.
D)More product variety is available in a country.

Question

Quizplus · Accepted Answer

Without trade, a country's production possibilities frontier becomes its consumption possibilities frontier because it can only consume what it produces, and it cannot benefit from specialization and trade with other countries. Option A is incorrect because self-sufficiency usually leads to higher costs of production and fewer goods and services available for consumers. Option C is also incorrect for the same reason. Option D is irrelevant to the situation.

If There Is No Trade, Which of the Following Is