Suppose that the United States has an absolute advantage over Mexico in producing both agricultural and manufactured goods.In the U.S. ,the opportunity cost of 1 unit of agricultural output is 2 units of manufactured goods.In Mexico,the opportunity cost of 1 unit of agricultural output is 1.5 units of manufactured goods.Total production in the U.S.and Mexico will be maximized if

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The U.S. should specialize in manufactured goods because it has a lower opportunity cost for them, while Mexico should specialize in agricultural goods as it has a lower opportunity cost for them. This way, both countries can trade and maximize total production.

Suppose That the United States Has an Absolute Advantage Over