1676EconomicsMedium
The doctrine of comparative advantage states that there are gains from international trade:
AIf countries specialize in the production of goods in which they are relatively more efficient.
BOnly if both comparative and absolute advantage are present in both countries.
CIf opportunity costs are the same in the countries involved.
DOnly if there are economies of scale available.
Correct answer
A. If countries specialize in the production of goods in which they are relatively more efficient.
Explanation
Comparative advantage suggests that even if a country does not have an absolute advantage, it should produce goods where it has the lowest opportunity cost.