Table 2-8

Table 2-8 shows the number of labor hours required to produce a digital camera and a pound of wheat in China and South Korea.
-Refer to Table 2-8.China has a comparative advantage in the production of
A)wheat.
B)digital cameras.
C)both products.
D)neither product.

Question

Table 2-8
  
Table 2-8 shows the number of labor hours required to produce a digital camera and a pound of wheat in China and South Korea.
-Refer to Table 2-8.China has a comparative advantage in the production of
A)wheat. 
B)digital cameras. 
C)both products. 
D)neither product.

Quizplus · Accepted Answer

In China, it takes fewer labor hours to produce a pound of wheat than in South Korea (0.5 vs 1 hour per pound). Therefore, China has a comparative advantage in the production of wheat. Conversely, in South Korea, it takes fewer labor hours to produce a digital camera than in China (10 vs 20 hours per camera), meaning that South Korea has a comparative advantage in the production of digital cameras.

Table 2-8 Table 2-8 Shows the Number of Labor Hours Required to of Labor