The primary benefits of international trade include:

Question

Quizplus · Accepted Answer

International trade allows countries to specialize in producing goods and services in which they have a comparative advantage, which leads to the efficient use of resources and higher living standards. This is the primary benefit of international trade.

Option B is incorrect because international trade can lead to instability in output, employment, and the price level due to competition from foreign producers.

Option C is also incorrect as dependence on foreign supplies can increase due to imports that meet domestic demand, which can be beneficial for the domestic economy.

Option D is incorrect because domestic producers may face competition from foreign producers, leading to economic insecurity if they cannot compete effectively.

The Primary Benefits of International Trade Include