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In a Two-Person, Two-Good Economy, the Benefits of Labor Specialization

Question 54

Multiple Choice

In a two-person, two-good economy, the benefits of labor specialization will be larger when:


A) one person has an absolute advantage in both goods.
B) neither person has an absolute advantage.
C) there are small differences in the respective opportunity costs of the two individuals for both goods.
D) there are large differences in the respective opportunity costs of the two individuals for both goods.

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