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Use the Following Scenario to Answer the Questions That Follow

Question 23

Multiple Choice

Use the following scenario to answer the questions that follow.
Karl and Pete produce cars and trucks. Karl can produce 10 cars per hour or 5 trucks per hour. Pete can produce 12 cars per hour or 4 trucks per hour.
-Based on the scenario,which of the following is true?


A) Karl has a comparative advantage in producing cars but not trucks.
B) Karl has a comparative advantage in producing trucks but not cars.
C) Karl has a comparative advantage in producing both goods.
D) Karl has a comparative advantage in producing neither good.
E) Karl does not have any comparative advantage.

Correct Answer:

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