Question: The human behavior that creates wealth is specialization in production according to Comparative Advantage. Collective Wealth increases when people, groups of people, countries or societies

 The human behavior that creates wealth is specialization in production according

The human behavior that creates wealth is specialization in production according to Comparative Advantage. Collective Wealth increases when people, groups of people, countries or societies specialize in the production of goods in which they have a comparative advantage. Imagine 2 countries, A and B, which produce 2 goods X and Y. If two countries take their productive resources, e.g. capital, labor, and land, and shift them out production of the good in which they have a Comparative Disadvantage and into the production of the good in which they have a Comparative Advantage, the total amount of X and Y that countries A and B produce collectively will increase For example, before specialization: Country A produces 10 units of Good X and 10 units of Good Y and Country B produces 20 units of Good X and 5 units of Good Y As a result of specialization shifts productive resources so that: Country A produces zero units of X and 20 units of Y. Country B produces 40 units of X and 0 units of Y. Note that A is increasing production of Y by shifting productive resources from X to Y production and B is increasing production of X by shifting productive resources from Y to X production. The total amount of good X produced collectively has increased by 10 units. The total amount of good Y produced has increase by 5 units. Collective wealth has increased. Collective wealth has stayed the same. Collective wealth has decreased. The individual wealth of Country A has increased. The individual wealth of Country B has increased. Any increase in Collective Wealth has been distributed equally. Any increase in Collective Wealth has been distributed equitably

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