Given the following information, does a comparative advantage opportunity exist?
A)Yes - both parties can pay less interest by borrowing where they have a comparative advantage and swapping their interest payments.
B)Yes - the potential savings from entering a swap are 1 per cent.
C)Yes -but a swap would reduce the cost of funds for B only.
D)No.
E)Cannot say with the available information.

Question

Given the following information, does a comparative advantage opportunity exist? 
A)Yes - both parties can pay less interest by borrowing where they have a comparative advantage and swapping their interest payments. 
B)Yes - the potential savings from entering a swap are 1 per cent. 
C)Yes -but a swap would reduce the cost of funds for B only. 
D)No. 
E)Cannot say with the available information.

Quizplus · Accepted Answer

The Answer of Given the following information, does a comparative advantage opportunity exist? 
A)Yes - both parties can pay less interest by borrowing where they have a comparative advantage and swapping their interest payments. 
B)Yes - the potential savings from entering a swap are 1 per cent. 
C)Yes -but a swap would reduce the cost of funds for B only. 
D)No. 
E)Cannot say with the available information.

Given the Following Information, Does a Comparative Advantage Opportunity Exist