Which is TRUE about specialization and exchange between two individuals?
A) They generally benefit the poorer individual at the expense of the richer individual.
B) They generally benefit the richer individual at the expense of the poorer individual.
C) They generally benefit the poorer individual as well as the richer individual.
D) They generally benefit neither the poorer individual nor the richer individual.

Question

Quizplus · Accepted Answer

Specialization and exchange between two individuals generally benefit both parties. Each individual can specialize in producing goods or services that they have a comparative advantage in, and then exchange them for the goods or services that the other individual specializes in. This results in both individuals being able to consume a greater variety and quantity of goods and services than they could have produced on their own, thus benefiting both parties.

Which Is TRUE About Specialization and Exchange Between Two Individuals