Which of the following is TRUE with respect to specialization?
A) Adam Smith in The Wealth of Nations referred to specialization and division of labor.
B) With a given set of resources, specialization results in higher output.
C) Individuals and nations specialize in their areas of comparative advantage in order to reap the gains of specialization.
D) All of the above are correct.

Question

Quizplus · Accepted Answer

All of the statements are true. Adam Smith discussed the benefits of specialization and division of labor in his book The Wealth of Nations. Specialization allows individuals and countries to produce more output with the same set of resources. Specialization also promotes comparative advantage, where individuals or countries specialize in the production of goods or services that they can produce more efficiently than others, resulting in increased productivity and economic gains.

Which of the Following Is TRUE with Respect to Specialization