-The above table shows the number of pencils or pens that could be produced by Don and Bob in an hour. This schedule shows that
A) Don has an absolute advantage in the production of pencils, and Bob has an absolute advantage in the production of pens.
B) Bob has an absolute advantage in the production of pencils, and Don has an absolute advantage in the production of pens.
C) Don has a comparative advantage in the production of both pencils and pens.
D) Bob has a comparative advantage in the production of pencils.

Question

-The above table shows the number of pencils or pens that could be produced by Don and Bob in an hour. This schedule shows that
A) Don has an absolute advantage in the production of pencils, and Bob has an absolute advantage in the production of pens. 
B) Bob has an absolute advantage in the production of pencils, and Don has an absolute advantage in the production of pens. 
C) Don has a comparative advantage in the production of both pencils and pens. 
D) Bob has a comparative advantage in the production of pencils.

Quizplus · Accepted Answer

Comparative advantage is determined by who has the lower opportunity cost for producing a good. Bob has a comparative advantage in the production of pencils if his opportunity cost of producing pencils is lower than Don's.

-The Above Table Shows the Number of Pencils or Pens