Suppose England has a comparative advantage over the United States in producing tea.If this is true,then:
A)England should produce more tea than it needs and sell the rest to the United States.
B)England should produce a small amount of tea and buy the rest of the tea it wants from the United States.
C)England should not produce tea,and should instead buy it all from the United States.
D)the United States has nothing to gain from buying tea from England.

Question

Quizplus · Accepted Answer

If England has a comparative advantage in producing tea, then it can produce tea at a lower opportunity cost than the United States. This means that England should specialize in producing tea and sell the excess to the United States, as both countries will benefit from trade. England will be able to produce more tea at a lower cost, and the United States will be able to purchase tea at a lower cost than producing it domestically.

Suppose England Has a Comparative Advantage Over the United States