Question

Which best explains why producers choose to specialize? Check all that apply. to increase competition to gain a comparative advantage to decrease the amount of goods produced to maintain market share to increase efficiency

Answer 1

Producers specialize thus they can gain a comparative advantage in the production and increase the efficiency of the product.

Option: b and d

Explanation:

Producers choose to specialize in a particular thing because making themselves perfect in manufacturing that one thing will make them to gain a comparative advantage to the other producers. Suppose one has specialization in making cotton and woolen materials with good designs then they are superior in the field of the textile industry. And sometimes they export things which leads to a great profit for them. Hence specialization gains comparative advantage. The producers specialize as they can reduce their effort by directly producing the product simple way and this increases the efficiency of the firm.

Answer 2

The correct answers are B) to gain a comparative advantage and D) to increase efficiency.

The statements that best explain why producers choose to specialize are "to gain a comparative advantage and to increase efficiency."

If companies and producers specialize in specific products, they can better elaborate their goods, reduce costs and aim a specific target. This action has benefits for clients because they are going to find specific products in the market that benefit their needs at better prices. So when manufacturing the goods, these companies are going to increase their efficiency and will be able to gain a comparative advantage because they will be the only ones that produce the specific product, not their competitors.