-Refer to Exhibit 2-9.If Alex and Adam each specialize in the good in which he has a comparative advantage and then engage in trade,____________________ can consume a combination of goods that lies beyond their PPF.
A) Alex,but not Adam,
B) Adam,but not Alex
C) Alex and Adam
D) neither Alex nor Adam

Question

-Refer to Exhibit 2-9.If Alex and Adam each specialize in the good in which he has a comparative advantage and then engage in trade,____________________ can consume a combination of goods that lies beyond their PPF.
A) Alex,but not Adam, 
B) Adam,but not Alex 
C) Alex and Adam 
D) neither Alex nor Adam

Quizplus · Accepted Answer

When individuals specialize in producing goods in which they have a comparative advantage and then trade, both parties can end up consuming a combination of goods that surpasses their individual production possibilities frontiers (PPFs), allowing both to benefit from trade.