Refer to Table 5. Chile has O a comparative advantage in wine production. O an absolute advantage in wine production. a comparative advantage in beer production. on absolute advantage in beer production.

Refer to Table 5. Chile has O a comparative advantage in wine production. O an absolute advantage in wine production. a comparative advantage in beer production. on absolute advantage in beer production.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.

Question

Productivity of beer and wine in Germany and Chile Germany Chile Beer(cases) 75 30 Wine (cases)75 60

Refer to Table 5. Chile has
a comparative advantage in wine production.
O an absolute advantage in wine production.
a comparative advantage in beer production.
O an absolute advantage in beer production.

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