Econostan can produce a widget at the cost of one thingamajig. Its trading partner can produce the same widget at a cost of two thingamajigs. Based on this information, which statement is true?
A) Econostan should specialize in widgets and import thingamajigs.
B) Econostan should specialize in thingamajigs and import widgets.
C) Econostan has a comparative advantage in producing thingamajigs.
D) There is no advantage to trade between the two.
Correct Answer:
Verified
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