John can make pizza at a lower opportunity cost than Allen,but Allen can make more pizzas per day than John.Therefore,
A) John cannot benefit from trade with Allen.
B) Allen cannot benefit from trade with John.
C) John has a comparative advantage in pizza.
D) John has an absolute advantage in pizza.
E) Allen has a comparative advantage in pizza.

Question

Quizplus · Accepted Answer

The given information indicates that John has a lower opportunity cost of making pizzas than Allen. This means that John has a comparative advantage in making pizzas. Therefore, John can benefit from trade with Allen by specializing in making pizzas and trading with Allen for other goods or services that Allen can produce at a lower opportunity cost.

John Can Make Pizza at a Lower Opportunity Cost Than