Table 3-6

-Refer to Table 3-6. Which of the following is correct?
A)England has a comparative advantage in bread and Spain has a comparative advantage in cheese.
B)England has a comparative advantage in cheese and Spain has a comparative advantage in bread.
C)England has a comparative advantage in both goods and Spain has a comparative advantage in neither good.
D)England has a comparative advantage in neither good and Spain has a comparative advantage in both goods.

Question

Table 3-6
 
-Refer to Table 3-6. Which of the following is correct?
A)England has a comparative advantage in bread and Spain has a comparative advantage in cheese. 
B)England has a comparative advantage in cheese and Spain has a comparative advantage in bread. 
C)England has a comparative advantage in both goods and Spain has a comparative advantage in neither good. 
D)England has a comparative advantage in neither good and Spain has a comparative advantage in both goods.

Quizplus · Accepted Answer

Comparative advantage is determined by the opportunity cost of producing goods. If England has a lower opportunity cost for bread and Spain for cheese, then each has a comparative advantage in those respective goods.

Table 3-6 -Refer to Table 3-6. Which of the Following Is Correct