If nations begin to expand their specialization in production for the purpose of trade,

Question

Quizplus · Accepted Answer

When nations specialize in production and engage in trade, they can produce more efficiently and at a lower cost, leading to an increase in total world output. This increase in output also leads to an increase in consumer surplus as consumers can purchase goods at a lower price. Therefore, both total world output and consumer surplus will increase when nations expand their specialization in production for trade.

If Nations Begin to Expand Their Specialization in Production for the Purpose