For Economics students,True or False?

Question

True or False:

A country cannot gain from trade with another country if it has an absolute advantage for all the goods produced by the two countries.

Answer 1

True .

Answer 2

It's false, trade results from comparative advantage not absolute advantage.

For links explaining why:

http://en.wikipedia.org/wiki/Comparative...

http://stevesuranovic.blogspot.com/2007/...

http://internationalecon.com/Trade/Tch40...

http://www.commonsenseeconomics.com/Read...

http://www.economist.com/blogs/freeexcha...

Answer 3

False, if that is the case the inferior country will be having all types of fire and going out of business sales which the leading country will prosper from, besides the more produced on per person per capital basis is always going to be benificial to everyone involved.