Trade allows countries to specialize in producing goods and services that they have a comparative advantage in, leading to lower costs and higher efficiency. This results in a greater variety of goods and services being available in the market at lower prices. Therefore, trade lowers costs and raises the variety of goods and services available.

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Trade Makes Costs

Question 20

Multiple Choice

Trade makes costs

A) higher and reduces the variety of goods and services available.
B) higher but raises the variety of goods and services available.
C) lower but reduces the variety of goods and services available.
D) lower and raises the variety of goods and services available.

Correct Answer: