Which of the following is a major limitation of the simple Ricardian model of comparative advantage?

A. The model ignores the principle of diminishing marginal returns.

B. The model recommends excessive governmental intervention in trade.

C. The outcome of the model suggested by Ricardo is a zero-sum game.

D. The model is against the idea of engaging in free trade with nations.

ANSWER:

A. The model ignores the principle of diminishing marginal returns.