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The author most probably uses the word "startling" in reference to the Law of Comparative Advantage because:

  • A.it is puzzling that no one before Adam Smith thought of the Law
  • B.the Law of Comparative Advantage holds even when there is an imbalance in the capabilities of the nations
  • C.it is surprising that the general public is unaware of the Law of Comparative Advantage
  • D.most countries do not consider the Law of Comparative Advantage when devising their trade policies

Answer: B

Correct answer: the Law of Comparative Advantage holds even when there is a large disparity in productivity between two nations

The passage says the theorem states that mutually beneficial trade is possible even if one nation is less productive than the other. That is what makes it startling: intuition says the less productive party must lose, and the law says otherwise.

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