The United States Has an Absolute Disadvantage to Spain on Wine

Multiple Choice

The United States has an absolute disadvantage to Spain on wine production.According to David Ricardo, specialization can be more efficient only in the following circumstances:

A) Spain intentionally slows its production.
B) The United States grows its own grapes, thereby reducing transport costs.
C) In this case, specialization will not have an impact on either country.
D) Specialization can lead to more efficient allocation of resources with free trade.