If the opportunity cost of a table is 5 chairs in nation A and 1 chair in nation B,it makes sense for nation B to produce chairs.

Question

Quizplus · Accepted Answer

In nation B, the opportunity cost of producing a chair is lower than in nation A, which means that nation B has a comparative advantage in producing chairs. Therefore, it makes sense for nation B to produce chairs and nation A to produce tables, as the overall production and trade will be more efficient and beneficial for both nations.

If the Opportunity Cost of a Table Is 5 Chairs