Asked by Elena Franco on May 06, 2024

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Specialization and trade based on comparative advantage allow nations to attain the following results, except

A) higher combined output.
B) higher consumption and standard of living.
C) rising total employment.
D) consuming combinations of products that are outside their PPCs.

Comparative Advantage

The ability of a country, firm, or individual to produce a particular good or service at a lower opportunity cost than others, leading to more efficient trade outcomes.

PPCs (Production Possibility Curves)

Graphical representations that show the maximum possible output combinations of two goods that an economy can achieve when all resources are fully and efficiently utilized.

  • Analyze how trade affects national standards of living and employment.
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MH
Melony HarrisonMay 08, 2024
Final Answer :
C
Explanation :
While specialization and trade can lead to higher combined output and higher consumption and standard of living, it may not necessarily lead to rising total employment. In some cases, it may result in job losses in certain industries that are not competitive on the global market. However, the gains from increased productivity and efficiency in other industries can outweigh the losses in terms of employment. It is also important to note that specialization and trade cannot allow a nation to consume combinations of products that are outside their PPCs, as this is limited by the availability of resources and technology.