Asked by
Carolyn Phillips
on Nov 05, 2024
Verified
The Dominican Republic has a comparative advantage in the production of tobacco, and Panama has a comparative advantage in the production of oranges. If both countries specialize based on the theory of comparative advantage
A) only the production of tobacco will increase.
B) only the production of both goods will increase.
C) only the consumption of both goods will increase.
D) the production and consumption of both goods will increase.
Comparative Advantage
The ability of a party to produce a particular good or service at a lower marginal and opportunity cost over another.
Specialize
The process of focusing effort and resources on a particular area of expertise or production to increase efficiency and output.
- Ascertain the implications of specialization and trade for the production and consumption of goods among countries.
Verified Answer
MQ
Learning Objectives
- Ascertain the implications of specialization and trade for the production and consumption of goods among countries.
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