World output will be maximized when each country pursues its comparative advantage.

Question

Quizplus · Accepted Answer

Pursuing comparative advantage means that each country produces and exports goods that they can produce at a lower opportunity cost compared to their trading partners. This leads to efficient allocation of resources and increased specialization, ultimately resulting in higher world output. Therefore, it is true that world output will be maximized when each country pursues its comparative advantage.

World Output Will Be Maximized When Each Country Pursues Its