Question 25 Economists favor free trade based on the theory of comparativelabsolute advantage, which recommends specialization and trade to increase world output. Are there real-life problems with this theory Oa. Yes. Countries may not want to depend on others for important items. O b. No. This theory means we miss out on the benefits of trade wars, which is a big loss. Oc. Both "yes" answers are correct. Od. Yes. Specialization can be risky, so diversification may be safer.

Question 25 Economists favor free trade based on the theory of comparativelabsolute advantage, which recommends specialization and trade to increase world output. Are there real-life problems with this theory Oa. Yes. Countries may not want to depend on others for important items. O b. No. This theory means we miss out on the benefits of trade wars, which is a big loss. Oc. Both "yes" answers are correct. Od. Yes. Specialization can be risky, so diversification may be safer.

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter3: Interdependence And The Gains Rrom Trade

Section: Chapter Questions

Problem 9PA

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