Table 3-3
Assume that Zimbabwe and Portugal can switch between producing toothbrushes and producing hairbrushes at a constant rate.

-Refer to Table 3-3.Portugal has an absolute advantage in the production of
A) toothbrushes and a comparative advantage in the production of toothbrushes.
B) toothbrushes and a comparative advantage in the production of hairbrushes.
C) hairbrushes and a comparative advantage in the production of toothbrushes.
D) hairbrushes and a comparative advantage in the production of hairbrushes.

Question

Table 3-3
Assume that Zimbabwe and Portugal can switch between producing toothbrushes and producing hairbrushes at a constant rate.
 
-Refer to Table 3-3.Portugal has an absolute advantage in the production of
A) toothbrushes and a comparative advantage in the production of toothbrushes. 
B) toothbrushes and a comparative advantage in the production of hairbrushes. 
C) hairbrushes and a comparative advantage in the production of toothbrushes. 
D) hairbrushes and a comparative advantage in the production of hairbrushes.

Quizplus · Accepted Answer

Portugal has an absolute advantage in the production of hairbrushes, as it can produce more hairbrushes in the same amount of time as Zimbabwe. Portugal also has a comparative advantage in the production of hairbrushes, as it has a lower opportunity cost for producing hairbrushes (giving up fewer units of toothbrush production) compared to Zimbabwe. Therefore, Portugal should specialize in producing hairbrushes while Zimbabwe specializes in producing toothbrushes to maximize their overall production efficiency.

Table 3-3 Assume That Zimbabwe and Portugal Can Switch Between Producing Toothbrushes