A World Trade Organization publication calls comparative advantage \"arguably th

Question

A World Trade Organization publication calls comparative advantage "arguably the single most powerful insight in economics." Source: World Trade Organization, "Understanding the WTO," www.wto.orglenglish/thewto_e/whatis_e/tif_e/fact3_e.htm The ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost than competitors is known as Referring to your answer above, what makes it such a powerful insight? OA. t explains why larger firms and countries economically dominate smaller firms and countries. O B. It is the basis for establishing an economic advantage over competing firms and countries ° C. It explains why if countries specialize and trade they will be better off OD. It explains why if individuals, firms, and countries specialize and trade they will be better off

Explanation / Answer

Solution:

The ability of an individual, a firm, or a country to produce a good or service at a lower opportunity cost than competitor is known as the comparative advantage

Referring to your answer above, what makes it such a powerful insight?

Answer: It explains why if individuals, firms, and countries specialize and trade they will be better off

Explanation: Individuals, firms, and countries are better off if they specialize in producing goods and services for the products and services where they have a comparative advantage and obtain the other goods and services they require by trading

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