Table 3-2
$\begin{array}{|c|c|c|c|c|}\hline&\text { Labour hours needed to produce one unit of: }&&\text { Amount produced in } 60 \text { hours: }\
\hline & \text { Butter (kg) } & \text { Butter (kg } & \text { Rice (kg) } & \text { Rice (kg) } \
\hline \text { Lee } & 6 & 10 & 15 & 4 \
\hline \text { John } & 3 & 20 & 15 & 4\\hline
\end{array}$
-According to Table 3-2:
A)Lee has a comparative advantage in butter, and John has a comparative advantage in rice
B)Lee has a comparative advantage in butter, and John has a comparative advantage in butter
C)Lee has a comparative advantage in rice, and John has a comparative advantage in butter
D)Lee has a comparative advantage in rice, and John has a comparative advantage in rice

Question

Table 3-2
 $\begin{array}{|c|c|c|c|c|}\hline&\text { Labour hours needed to produce one unit of: }&&\text { Amount produced in } 60 \text { hours: }\
\hline & \text { Butter (kg) } & \text { Butter (kg } & \text { Rice (kg) } & \text { Rice (kg) } \
\hline \text { Lee } & 6 & 10 & 15 & 4 \
\hline \text { John } & 3 & 20 & 15 & 4\\hline
\end{array}$
-According to Table 3-2:
A)Lee has a comparative advantage in butter, and John has a comparative advantage in rice
B)Lee has a comparative advantage in butter, and John has a comparative advantage in butter
C)Lee has a comparative advantage in rice, and John has a comparative advantage in butter
D)Lee has a comparative advantage in rice, and John has a comparative advantage in rice

Quizplus · Accepted Answer

To determine comparative advantage, we look at the opportunity cost of producing each good. Lee can produce one pound of butter at the cost of 2 pounds of rice, while John can produce one pound of butter at the cost of 3 pounds of rice. Therefore, Lee has a lower opportunity cost in producing butter than rice, and John has a lower opportunity cost in producing rice than butter. This means Lee has a comparative advantage in rice, and John has a comparative advantage in butter. Therefore, Choice C is the correct answer.

Table 3-2 -According to Table 3-2: A)Lee Has a Comparative Advantage in unit

Table 3-2 -According to Table 3-2:
A)Lee Has a Comparative Advantage in unit