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
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While a country should specialize in the good for which it has an absolute advantage, it doesn't necessarily mean it should export that good. It depends on other factors such as the demand for that good in other countries and the cost of production. (B) This Show more…
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Are the following statements true or false? Explain in each case. a. "Two countries can achieve gains from trade even if one of the countries has an absolute advantage in the production of all goods." b. "Certain talented people have a comparative advantage in everything they do." c. "If a certain trade is good for one person, it can"t be good for the other one." d. "If a certain trade is good for one person, it is always good for the other one." e. "If trade is good for a country, it must be good for everyone in the country."
Are the following statements true or false? Explain in each case. a. "Two countries can achieve gains from trade even if one of the countries has an absolute advantage in the production of all goods." b. "Certain talented people have a comparative advantage in everything they do." c. "If a certain trade is good for one person, it can't be good for the other one." d. "If a certain trade is good for one person, it is always good for the other one." e. "If trade is good for a country, it must be good for everyone in the country"
Prashant B.
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