Which of the following statements is true of the theory of absolute advantage?
A) It was advocated by British economist David Ricardo.
B) It opened the floodgates for the free trade movement.
C) It suggests that international trade is a zero-sum game.
D) It is more realistic and useful than comparative advantage when applied in the real world.

Question

Quizplus · Accepted Answer

The theory of absolute advantage, proposed by Adam Smith, suggests that countries should specialize in producing goods where they have an absolute efficiency advantage. This idea laid the groundwork for the free trade movement by promoting the benefits of specialization and trade.

Which of the Following Statements Is True of the Theory