Specialization and trade can create more wealth (output of goods and services):
A)when we only trade for things we could not produce ourselves.
B)when each person specializes in what they do relatively best and trade for the rest.
C)only if we gain and other countries lose.
D)only with certain nations.

Question

Specialization and trade can create more wealth (output of goods and services):
A)​when we only trade for things we could not produce ourselves.
B)​when each person specializes in what they do relatively best and trade for the rest.
C)​only if we gain and other countries lose.
D)​only with certain nations.

Quizplus · Accepted Answer

When each person specializes in what they do relatively best and trade for the rest, it allows for increased productivity and efficiency, leading to a greater output of goods and services overall. This is known as the principle of comparative advantage. It does not require the other party to lose for one party to gain, and it can work with any nation that has differing comparative advantages.

Specialization and Trade Can Create More Wealth (Output of Goods