If England uses one week's time to produce ten yards of cloth or two barrels of wine and Portugal uses one week's time to produce twelve yards of cloth or six barrels of wine, England has the comparative advantage in both goods.

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Comparative advantage means that a country can produce a good with a lower opportunity cost (i.e., giving up the production of another good). In this scenario, England's opportunity cost of producing 1 yard of cloth is giving up the production of 1/5 barrels of wine (10 yards of cloth = 2 barrels of wine), while Portugal's opportunity cost of producing 1 yard of cloth is giving up the production of 1/2 barrel of wine (12 yards of cloth = 6 barrels of wine). Therefore, Portugal has the comparative advantage in cloth production (it gives up less wine to produce one more yard of cloth), while England has the comparative advantage in wine production (it only needs to give up 1/5 yards of cloth to produce one more barrel of wine).

If England Uses One Week's Time to Produce Ten Yards