Final answer:
The correct answer is: B) areas from which it is easy to trade.
Step-by-step explanation:
Adam Smith, a significant figure in economic theory, posited that wealth can be generated through effective production and trade based on a nation's comparative advantage. He suggested that countries should specialize in the production of goods they can produce most efficiently compared to others and trade these goods internationally. Consequently, according to Adam Smith, the areas that would be wealthy are those from which it is easy to trade (B). This is because these areas can capitalize on their specific advantages in producing certain goods or services, thus engaging in beneficial exchange. For example, the United States has rich farmland which makes it an ideal location for agriculture, whereas Saudi Arabia's natural endowment makes it efficient in extracting oil with minimal resources. Similarly, Guatemala and Colombia's climates are perfect for coffee growing, and regions like Chile have a wealth of copper mines. These regions would focus on producing what they have an absolute advantage in, leading to trade based on the advantages varied geographies offer.
However, it's crucial to differentiate the concepts of absolute and comparative advantage. While absolute advantage refers to the capability of producing more of a good with the same quantity of resources, comparative advantage involves producing goods at a lower opportunity cost. Thus, even if a country doesn't have an absolute advantage, it can still be wealthy if it intelligently leverages its comparative advantages.