Use the following to answer questions:
Figure: Countries A and B
-(Figure: Countries A and B) Refer to the figure regarding countries A and B. The opportunity cost of producing Good X in Country A is _____ and in Country B it is _____ meaning that Country _____ should specialize in producing Good X and Country _____ in Good Y.
A) 2Y; 1Y; B; A
B) 1/2Y; 1Y; B; A
C) 1/2Y; 1Y; A; B
D) 2Y; 1Y; A; B

Question

Use the following to answer questions:
Figure: Countries A and B 
-(Figure: Countries A and B) Refer to the figure regarding countries A and B. The opportunity cost of producing Good X in Country A is _____ and in Country B it is _____ meaning that Country _____ should specialize in producing Good X and Country _____ in Good Y.
A) 2Y; 1Y; B; A 
B) 1/2Y; 1Y; B; A 
C) 1/2Y; 1Y; A; B 
D) 2Y; 1Y; A; B

Quizplus · Accepted Answer

The opportunity cost of producing Good X in Country A is 2Y, and in Country B it is 1Y. This means that Country B has a comparative advantage in producing Good X, and Country A has a comparative advantage in producing Good Y.

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