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France and England Both Produce Wine and Cloth with Constant

Question 20

Multiple Choice

France and England both produce wine and cloth with constant opportunity costs.France can produce 150 barrels of wine if it produces no cloth or 100 bolts of cloth if it produces no wine.England can produce 50 barrels of wine if it produces no cloth or 100 bolts of cloth if it produces no wine.Using this information,we can conclude that:


A) France has a comparative advantage in cloth production.
B) England has a comparative advantage in cloth production.
C) France has a comparative advantage in both goods.
D) mutually beneficial international trade is not possible.

Correct Answer:

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