Which of the following statements is true about specialization and trade?
Choose 1 answer:
(A) A country should specialize in and export the good for which it has absolute advantage.
(B) A country should specialize in and import the good for which it has comparative advantage.
(c) A country should specialize in and import the good for which it has absolute advantage.
(D) A country should specialize in and export the good for which they have comparative advantage.
(E) A country should specialize in and export a good for which they have both comparative and absolute advantage

Question

Which of the following statements is true about specialization and trade?
Choose 1 answer:
(A) A country should specialize in and export the good for which it has absolute advantage.
(B) A country should specialize in and import the good for which it has comparative advantage.
(c) A country should specialize in and import the good for which it has absolute advantage.
(D) A country should specialize in and export the good for which they have comparative advantage.
(E) A country should specialize in and export a good for which they have both comparative and absolute advantage

Accepted Answer

***D*** ∻Key Concept∻ ⚹Comparative Advantage⚹ ∻Explanation∻ ⚹A country should specialize in producing and exporting goods for which it has a comparative advantage, meaning it can produce at a lower opportunity cost relative to other goods, even if it doesn't have an absolute advantage. This allows for more efficient global resource allocation and increased total output, benefiting all trading partners.⚹◊From a Macro Economics perspective, how does specialization and trade contribute to overall economic growth and efficiency within a country?⍭ Generate me a similar question◊

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