Home Unit Labor Requirement Foreign Unit Labor Requirement Fish Beer 3. 8. Which statement is correct? O Home has an absolute advantage in both fish and beer and a comparative advantage in beer. O Foreign has an absolute advantage in both fish and beer and a comparative advantage in beer. O Home has an absolute advantage in both fish and beer and a comparative advantage in neither fish nor beer. O Home has an absolute and comparative advantage fish and Foreign has an absolute and comparative advantage in beer.

Calculus: Early Transcendentals
8th Edition
ISBN:9781285741550
Author:James Stewart
Publisher:James Stewart
Chapter1: Functions And Models
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Home Unit Labor Requirement Foreign Unit Labor Requirement
Fish
2
3
Beer
8.
Which statement is correct?
O Home has an absolute advantage in both fish and beer and a comparative advantage
in beer.
O Foreign has an absolute advantage in both fish and beer and a comparative
advantage in beer.
O Home has an absolute advantage in both fish and beer and a comparative advantage
in neither fish nor beer.
O Home has an absolute and comparative advantage fish and Foreign has an absolute
and comparative advantage in beer.
3.
Transcribed Image Text:Home Unit Labor Requirement Foreign Unit Labor Requirement Fish 2 3 Beer 8. Which statement is correct? O Home has an absolute advantage in both fish and beer and a comparative advantage in beer. O Foreign has an absolute advantage in both fish and beer and a comparative advantage in beer. O Home has an absolute advantage in both fish and beer and a comparative advantage in neither fish nor beer. O Home has an absolute and comparative advantage fish and Foreign has an absolute and comparative advantage in beer. 3.
Expert Solution
Step 1

Solution) absolute advantage tend to refer more productive 

Here home labor unit requirement is 2 for fish 

And 3 for beer 

And foreign labour unit requirement 3 for fish 8 for beer

In home we require less labor unit require as compared to foreign

So home is productive

Home is absolute advantage in both fish and beer 

 

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