Specialization according to comparative advantage can
A) generate more output than being self-sufficient
B) make economies be less dependent on others
C) is very costly and hard to implement
D) cause too much of one type of good to be produced
E) All of these

Question

Quizplus · Accepted Answer

Specialization based on comparative advantage allows countries to specialize in producing goods that they are relatively more efficient in producing compared to other goods. This leads to an increase in the overall output of goods and services, which is not possible if a country tries to be self-sufficient. Therefore, option A is the correct answer. Option B is partly correct, but it does not capture the full potential of specialization. Option C is incorrect because specialization actually reduces costs by allowing countries to focus on producing goods that they are good at. Option D is incorrect because specialization ensures that countries produce the goods they are relatively more efficient at, and not just one type of good. Hence, the correct answer is A.

Specialization According to Comparative Advantage Can