The graph below shows the production possibility curves for two hypothetical nations,Orin and Pohl,which each make two hypothetical products,jaxs and keps.Which of the following statements is correct?

Question

Quizplus · Accepted Answer

According to the graph, Pohl has a steeper slope for jaxs, indicating a higher opportunity cost of producing jaxs compared to Orin. Therefore, Pohl has a comparative advantage in producing keps rather than jaxs. Orin, on the other hand, has a flatter slope for jaxs, indicating a lower opportunity cost of producing jaxs compared to Pohl. However, we cannot say that Orin has a comparative advantage in both jaxs and keps as we do not have enough information about the opportunity cost of producing keps in both nations. We also cannot conclude that Orin is more efficient than Pohl based on the given graph.

The Graph Below Shows the Production Possibility Curves for Two