(a) What is the opportunity cost of producing a unit of wheat in the United Kingdom? In the United States? (b) Which country has an absolute advantage in producing wheat? In producing cloth? (c) Which country has a comparative advantage in producing wheat? In producing cloth?
(a) What is the opportunity cost of producing a unit of wheat in the United Kingdom? In the United States? (b) Which country has an absolute advantage in producing wheat? In producing cloth? (c) Which country has a comparative advantage in producing wheat? In producing cloth?
Chapter1: Making Economics Decisions
Section: Chapter Questions
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Transcribed Image Text:2. Absolute and Comparative Advantage:
Labor Hours
Required to
Produce One Unit
UK USA
Wheat
2
1
Cloth
6
(a) What is the opportunity cost of producing
a unit of wheat in the United Kingdom? In
the United States?
(b) Which country has an absolute advantage
in producing wheat? In producing cloth? (c)
Which country has a comparative advantage
in producing wheat? In producing cloth?
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