-In the figure above, both Joe and Jill initially produce at point A. If Joe and Jill realize that they each possess a comparative advantage, which outcome can we expect?
A) Joe will specialize in shirts and Jill will specialize in pants.
B) Joe and Jill each will be able to consume more than 2 shirts and 2 pairs of pants.
C) Joe will specialize in pants and Jill will specialize in shirts.
D) Both answers B and C are correct.

Question

-In the figure above, both Joe and Jill initially produce at point A. If Joe and Jill realize that they each possess a comparative advantage, which outcome can we expect?
A) Joe will specialize in shirts and Jill will specialize in pants. 
B) Joe and Jill each will be able to consume more than 2 shirts and 2 pairs of pants. 
C) Joe will specialize in pants and Jill will specialize in shirts. 
D) Both answers B and C are correct.

Quizplus · Accepted Answer

If Joe and Jill realize their comparative advantages, they will specialize in the production of the good for which they have a lower opportunity cost. This specialization allows them to trade and consume more than they could individually produce, leading to both being able to consume more than 2 shirts and 2 pairs of pants.

-In the Figure Above, Both Joe and Jill Initially Produce