If Costa Rica is able to produce 50,000 pounds of bananas a day, while Nicaragua can produce 30,000 pounds of bananas a day, which statement must be true?
A) Costa Rica has an absolute advantage over Nicaragua in banana production.
B) Costa Rica has a comparative advantage over Nicaragua in banana production.
C) Costa Rica has both an absolute advantage and comparative advantage over Nicaragua in banana production.
D) Costa Rica does not necessarily have an absolute advantage nor a comparative advantage over Nicaragua in banana production.
Correct Answer:
Verified
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