Question

Countries that engage in trade will tend to specialize in the production of goods and services in which they have ________ and will ________ these goods and services.

Answer 1

Answer:

Countries that engage in trade will tend to specialize in the production of goods and services in which they have COMPARATIVE and will EXPORTS these goods and services.

Explanation:

Countries will trade the goods in which they have a comparative advantage in their production, that means that the opportunity cost of producing them is lower compared to other countries. Gains resulting from trade are not based on absolute advantages since resources are limited for everyone, so a country must produce and export the goods at which their opportunity cost is the lowest.