Based on the comparative cost ratios implied in Figure 35.2,it is clear that
A)The United States has a comparative advantage in baseballs and Mexico has a comparative advantage in golf shoes.
B)Mexico should import all of its golf shoes from the United States.
C)The United States should import all of its baseballs from Mexico.
D)The United States should specialize in producing golf shoes,and Mexico should specialize in producing baseballs.

Question

Based on the comparative cost ratios implied in Figure 35.2,it is clear that
A)The United States has a comparative advantage in baseballs and Mexico has a comparative advantage in golf shoes. 
B)Mexico should import all of its golf shoes from the United States. 
C)The United States should import all of its baseballs from Mexico. 
D)The United States should specialize in producing golf shoes,and Mexico should specialize in producing baseballs.

Quizplus · Accepted Answer

The comparative cost ratios imply that the United States has a lower opportunity cost (produces more efficiently) for baseballs than golf shoes, while Mexico has a lower opportunity cost for golf shoes than baseballs. Therefore, the United States should specialize in producing baseballs, and Mexico should specialize in producing golf shoes.

Based on the Comparative Cost Ratios Implied in Figure 35