What Happens When Countries Specialize According to Their Comparative Advantage

question 106

Multiple Choice

What happens when countries specialize according to their comparative advantage?

• A) It is possible to increase world output of all goods.
• B) It is possible to increase world output of some goods only by reducing the output of others.
• C) One country is likely to gain from trade while others lose.
• D) All countries will lose from trade.

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Definitions:

Basic Requirements

Fundamental needs or conditions necessary for individuals or systems to function properly.

Geographic Location

The specific physical position of something on Earth, often described using coordinates of latitude and longitude.

Broad Skill Set

Refers to having a wide range of abilities and competencies across different areas or disciplines.

Asset Ownership

The legal right or interest that a person or entity has in items of value, such as property, investments, or intellectual property.