Which of the following is NOT an implication of our model of trade?
A) Trade allows for specialization.
B) Trade is good for nations.
C) Trade is based on absolute advantage.
D) Trade allows individuals to consume more than otherwise.

Question

Quizplus · Accepted Answer

Our model of trade is based on comparative advantage, not absolute advantage. Absolute advantage suggests that a nation or individual can produce a good or service more efficiently than any other nation or individual, while comparative advantage suggests that a nation or individual should specialize in the production of goods or services in which it has a lower opportunity cost.

Which of the Following Is NOT an Implication of Our