Suppose that,given the same number of workers,the United States can produce two times as many TVs or 20 times as many potatoes as Chile.Which of the following statements is true?
A) Chile should trade with the United States for potatoes because the United States has an absolute advantage in the production of potatoes.
B) Chile should trade with the United States for TVs because the United States has an absolute advantage in the production of potatoes.
C) The United States can benefit from trading TVs but not potatoes with Chile.
D) The United States has absolute advantage in producing both goods.

Question

Quizplus · Accepted Answer

The United States has an absolute advantage in producing both TVs and potatoes because it can produce more of both goods with the same number of workers compared to Chile.

Suppose That,given the Same Number of Workers,the United States Can