How are a nation’s production possibilities affected by specialization and trade based on the law of comparative advantage? A)Only a nation with an absolute advantage has a shift in the PPC B)A nation’s trading possibilities shifts the PPC curve to the right, or outside the original production possibilities. C)A nation’s trading possibilities shifts the PPC curve to the left, or inside the original production possibilities. D)The production possibilities curve, before and after trade does not change

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Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.