Scenario: Foodland and Drinkland
Two countries, Foodland and Drinkland, produce food and drinks. In Foodland, one resource unit produces 20 tons of food and one resource unit produces 10 tons of drinks. In Drinkland, one resource unit produces 12 tons of food and one resource unit produces 24 tons of drinks.
Food Drinks
Foodland 20 10
Drinkland 12 24
-Which of the following is a true statement about the above scenario?

Question

Quizplus · Accepted Answer

Foodland has an absolute advantage in producing food because it can produce more food with the same amount of resources than Drinkland. Drinkland has an absolute advantage in producing drinks because it can produce more drinks with the same amount of resources than Foodland.