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France and Italy can make both wine (W) and cheese (C). However, there may be advantage for the countries to specialize in one good and
France and Italy can make both wine (W) and cheese (C). However, there may be advantage for the countries to specialize in one good and trade for another. Both countries have 1000 hours of labor to devote to W and C. In France, it takes 2 labor hours to make case of C and 2 labor hours to make a case of W. In Italy, it takes 2 labor hours to make C and 4 labor hours to make W. Determine what each country's production possibilities frontier equations look like both algebraically and graphically (it might be easiest to solve for Can then plot C on vertical axis). From this information we know that both countries have a comparative advantage in wine production. Italy has a comparative advantage in wine production. neither country has a comparative advantage in wine production. France has a comparative advantage in wine production
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