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David Ricardo discovered that two countries can still gain by trading even if one country is...

David Ricardo discovered that two countries can still gain by trading even if one country is more efficient in the production of every commodity. Ricardo's discovery is called the law of

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Answer #1

Ricardo's discovery is called the law of comparative advantage.

According to David Ricardo even when the countries which have absolute advantage in producing a good or service will get benefited by trading with other countries this happens due to the effect of specialisation.

Under comparative advantage the country with lower opportunity cost. Due to specialisation the countries will get benefited through trade.

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