Use the table below to answer the following question. The table outlines the production possibilities for two hypothetical countries. Which of the following statements is true?

Question

Use the table below to answer the following question. The table outlines the production possibilities for two hypothetical countries.  Which of the following statements is true?

Quizplus · Accepted Answer

According to the table, Redland has a comparative advantage in producing mutton since it can produce 600 units of mutton while Blueland can only produce 300 units. On the other hand, Blueland has a comparative advantage in producing oats since it can produce 400 units of oats while Redland can only produce 200 units. Therefore, Redland should specialize in producing mutton and trade with Blueland for oats. Blueland would also benefit from trade as it can acquire mutton from Redland at a lower opportunity cost than producing it themselves.

Use the Table Below to Answer the Following Question