Country A can produce 10 yards of textiles or 6 pounds of food per unit of input.Country B can produce 8 yards of textiles or 5 pounds of food per unit of input.Which of the following statements is true?
A)Country A is relatively more efficient than Country B in the production of food.
B)Country B is relatively more efficient than Country A in the production of textiles.
C)Country A is relatively more efficient than Country B in the production of textiles.
D)none of the options

Question

Quizplus · Accepted Answer

To determine which country is relatively more efficient in the production of a certain good, we need to compare the opportunity costs of producing that good in each country. The opportunity cost is the amount of the other good that must be given up to produce one unit of the good in question.

For Country A, the opportunity cost of producing 1 yard of textiles is 6/10 = 0.6 pounds of food. 
For Country B, the opportunity cost of producing 1 yard of textiles is 5/8 = 0.625 pounds of food. 
Therefore, Country A has a lower opportunity cost of producing textiles, meaning it is relatively more efficient at producing textiles than Country B.

Country a Can Produce 10 Yards of Textiles or 6