Recall the Application about productivity in the nation of Latvia in the 1990s to answer the following question(s).
-According to the Application,if Latvia has no absolute advantage relative to its neighboring European countries,should it still trade with its neighbors?
A) Yes, it should specialize in saw timber because it has comparative advantage in it.
B) Yes, it should specialize in livestock because it has comparative advantage in it.
C) Yes, it should specialize in grain because it has comparative advantage in it.
D) No, it should not specialize in anything, and it should just trade with countries outside its neighboring European countries.

Question

Quizplus · Accepted Answer

Even without absolute advantage, a country can benefit from trade by specializing in the production of goods for which it has a comparative advantage. This allows for more efficient production and trade benefits.

Recall the Application About Productivity in the Nation of Latvia