When the principle of comparative advantage is used to guide trade, then a country specialises in producing only
A) goods with the lowest opportunity cost.
B) goods for which production costs are more than average total costs.
C) goods with the highest opportunity cost.
D) goods for which production takes fewer worker- hours than in another country.

Question

Quizplus · Accepted Answer

The principle of comparative advantage suggests that a country should specialize in producing and exporting goods for which it has the lowest opportunity cost of production, allowing it to maximize efficiency and gains from trade.

When the Principle of Comparative Advantage Is Used to Guide