Question
River can produce $60 worth of goods in market production, and $10 in home production. Lake can produce $35 worth of goods in market production
River can produce $60 worth of goods in market production, and $10 in home production. Lake can produce $35 worth of goods in market production and $10 in home production.
According to the household model and the principle of comparative advantage, how should River and Lake allocate their time?
Group of answer choices:
- River should specialize in home production and Lake should specialize in market production.
- Both River and Lake should specialize in market production.
- River should specialize in market production and Lake should specialize in home production.
-Both River and Lake should specialize in home production.
-There is not enough information given to answer the question.
Give proper explanation
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