Asked by

Daven Babero
on Dec 11, 2024

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The law of comparative advantage suggests that

A) curtailing U.S. trade with other countries would make U.S. consumers better off.
B) everyone would be better off if they were self-sufficient.
C) countries will tend to import commodities that they can produce at a relatively low opportunity cost.
D) countries will tend to import commodities that they can produce at a relatively high opportunity cost.

Comparative Advantage

The ability of an individual, firm, or country to produce a particular good or service at a lower opportunity cost than others, leading to a basis for beneficial trade.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision, effectively the value of the opportunity lost.

Import Commodities

Goods or services brought into one country from another for the purpose of trade.

  • Become familiar with the theory of the law of comparative advantage.
  • Recognize the benefits of trade and specialization.
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ZJ
Zachery JohnsonDec 17, 2024
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