The United States has a comparative advantage in the production of wheat, and Haiti has a comparative advantage in the production of sugar. If both countries specialize based on the theory of comparative advantage
the production and the consumption of both the goods will increase.
Explanation:
The U.S and the Haiti have a comparative advantage in the production of the wheat and sugar thus they can maximize their combined output and allocate their resources more efficiently.
If both of the countries tend to specials on the basis of the theory of comparative cost advantage given by David Ricardo.
