The table below shows units of wheat and cloth produced by each worker per day in both the countries.Table 20.1

-Which of the following can be inferred from the information provided in Table 20.1?

Question

The table below shows units of wheat and cloth produced by each worker per day in both the countries.Table 20.1
 
-Which of the following can be inferred from the information provided in Table 20.1?

Quizplus · Accepted Answer

Comparative advantage is determined by which country can produce a good at a lower opportunity cost. Without seeing Table 20.1, the correct inference based on the options given is that if one country is suggested to benefit from producing and exporting a specific good (in this case, cloth for India), it implies that country has a comparative advantage in producing that good. Comparative advantage encourages countries to specialize in the production of goods where they are most efficient, suggesting India has a comparative advantage in cloth if it benefits from producing and exporting it.

The Table Below Shows Units of Wheat and Cloth Produced