Final answer:
Worldwide output and consumption are maximized when each nation specializes in goods where they have a comparative advantage, leading to increased production and benefits for all participating countries.
Step-by-step explanation:
According to the principle of comparative advantage, worldwide output and consumption levels will be highest when goods are produced in nations where they can produce those goods at a lower opportunity cost than other countries. This means that even if a country has an absolute advantage in producing all goods, there can still be gains from trade by each country specializing in the production of goods for which they have the strongest relative efficiency compared to others. By doing so, all countries can benefit from higher production levels and increased consumption possibilities.