-Refer to Table 3-1. How could the farmer and rancher both benefit?
A) by the farmer specializing in meat and the rancher specializing in potatoes
B) by the farmer specializing in potatoes and the rancher specializing in meat
C) by the farmer specializing in neither good and the rancher specializing in both goods
D) by the farmer specializing in both goods and the rancher specializing in neither good

Question

-Refer to Table 3-1. How could the farmer and rancher both benefit?
A) by the farmer specializing in meat and the rancher specializing in potatoes 
B) by the farmer specializing in potatoes and the rancher specializing in meat 
C) by the farmer specializing in neither good and the rancher specializing in both goods 
D) by the farmer specializing in both goods and the rancher specializing in neither good

Quizplus · Accepted Answer

The principle of comparative advantage suggests that both parties can benefit by specializing in the production of the good for which they have a lower opportunity cost and then trading. In this scenario, without seeing Table 3-1, the correct answer typically involves each party specializing in the production of different goods, which aligns with choice B, where the farmer specializes in potatoes and the rancher in meat, assuming their respective comparative advantages align with these goods.