Assume That Spain Has a Comparative Advantage in Fish and Germany

question 196

Multiple Choice

Assume that Spain has a comparative advantage in fish and Germany has a comparative advantage in cars.What will happen if these two countries specialize and trade according to their comparative advantage

• A)All individuals in both countries will benefit.
• B)Spain will specialize in and export cars.
• C)Germany will produce more cars than fish in the absence of trade.
• D)Germany will produce more fish than cars in the absence of trade.