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Suppose that Country A can produce either 6 units of food or 2 cars in one day, while Country B can produce either 4 units
Suppose that Country A can produce either 6 units of food or 2 cars in one day, while Country B can produce either 4 units of food or 2 cars in one day. Which of the following is true?
Neither country has the comparative advantage in the production of cars. |
Country B has the comparative advantage in the production of cars. |
Country A has the comparative advantage in the production of cars. |
Country A would not benefit from specialization and trade. |
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