Use the accompanying table to answer the following questions.
Table 3-4

-Refer to Table 3-4. If England and Spain specialise and trade according to their respective comparative advantages:
A) all individuals in both countries will benefit
B) Spain will specialise in and export bread
C) England will produce more bread than in the absence of trade
D) England will produce more cheese than in the absence of trade

Question

Use the accompanying table to answer the following questions.
Table 3-4
 
-Refer to Table 3-4. If England and Spain specialise and trade according to their respective comparative advantages:
A) all individuals in both countries will benefit 
B) Spain will specialise in and export bread 
C) England will produce more bread than in the absence of trade 
D) England will produce more cheese than in the absence of trade

Quizplus · Accepted Answer

When countries specialize according to their comparative advantage, they produce more of the good for which they have a lower opportunity cost. If England has a comparative advantage in bread, it will produce more bread than it would without trade.

Use the Accompanying Table to Answer the Following Questions