Question

What is a consequence of following the Comparative Advantage Principle?
a.
Countries only make one kind of good or service.
b.
Wages scale to exactly match the skill of the wage-earners.
c.
Countries become more interdependent on one another for goods and materials.
d.
Goods are traded directly, rather than using monetary trade.


Please select the best answer from the choices provided

A
B
C
D

Answer 1

C

Following comparative advantage leads countries to specialize in what they produce most efficiently and trade for other goods, increasing interdependence.