In the country Gamma it takes 6 hours to produce one automobile and 1 hour to produce a bale of cotton. In the country Delta it takes 10 hours to produce one automobile and 2.5 hours to produce a bale of cotton. Which of the following is true?

The countries cannot benefit from specialization and trade.

Delta has an absolute advantage in producing cotton and a comparative advantage in producing automobiles.

Delta has an absolute advantage in producing both automobiles and cotton.

Gamma has an absolute advantage in producing both goods and a comparative advantage in producing cotton.

Gamma would benefit from trading between 6 automobiles for one bale of cotton.

Johnson won a free ticket to tour around the world in one year, but he will have to resign from his job. Which of the following is correct if he does cost-benefit analysis?

The tour provides only benefits.

The only cost will be paying for food.

There is no opportunity cost to be considered.

The cost of the lost income is equal to the benefit of the free ticket.

The result may lead to a sub-optimal choice if opportunity costs are not considered.