Assume Country A and Country B each have the same amount of resources with which to produce wheat and corn and they produce no other goods.The values in Table 17.2 represent the maximum amount of each good that can be produced.
Table 17.1 - Full-employment output of goods
-Based on the information in Table 17.2,the output of corn and wheat would be greatest if:

Question

Assume Country A and Country B each have the same amount of resources with which to produce wheat and corn and they produce no other goods.The values in Table 17.2 represent the maximum amount of each good that can be produced.
Table 17.1 - Full-employment output of goods 
-Based on the information in Table 17.2,the output of corn and wheat would be greatest if:

Quizplus · Accepted Answer

Country A has an absolute advantage in producing corn, as it can produce 200 units compared to Country B's 100 units. Similarly, Country B has an absolute advantage in producing wheat, as it can produce 160 units compared to Country A's 80 units.
However, if each country specializes in producing the good in which it has an absolute advantage, they can trade with each other and both can end up having more of both goods. Thus, Country A should specialize in producing corn and Country B should specialize in producing wheat, which would result in the greatest output of both goods. This is known as the principle of comparative advantage in international trade.

Assume Country a and Country B Each Have the Same