Suppose the opportunity cost of producing 1 coconut in Samoa is 4 pineapples, while the opportunity cost of producing 1 coconut in Guam is 5 pineapples. This implies that:
A) Guam has a comparative advantage over Samoa in the production of coconuts.
B) Guam will be better off if it exports coconuts and imports pineapples.
C) Samoa will be better off if it exports pineapples and imports coconuts.
D) Samoa has a comparative advantage over Guam in the production of coconuts.
E) Samoa has an absolute advantage over Guam in the production of coconuts.
Correct Answer:
Verified
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