Should countries specialize in producing goods and services based ...

[magmichele12]

Should countries specialize in producing goods and services based on having a comparative advantage or an absolute advantage? Why?
 
  What will be an ideal response?

Question 2

Refer to the Article Summary. The article discusses the rising administrative costs of health care.
 
  Even if private insurance companies were more efficient and brought administrative costs down, consumers would still pay less than the full cost of medical treatment. This would result in the market equilibrium price of medical services being ________ than the efficient equilibrium price, and the market equilibrium quantity of medical services being ________ than the efficient equilibrium quantity.
  A) less; less B) greater; less C) less; greater D) greater; greater

[heyhey123]

Answer to Question 1

Countries should specialize in producing products based on comparative advantage because this allows countries to produce those products and services at a lower opportunity cost than competitors.

Answer to Question 2

D