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International Trade

Question 15 • IL-Economics

Brazil chose to specialize in the production of bananas because it in producing it.

Answer
A
had a comparative advantage
B
had an absolute advantage

Explanation

A country specializes in producing a good when it has a comparative advantage in that good: it can produce it at a lower opportunity cost than another country. An absolute advantage means producing more with the same resources, which is not the reason given for specialization here. So the correct choice is “had a comparative advantage.”

AI-written and checked against the verified answer.

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