Dacians and Romans are at war and they are both producing bows and arrows.The Dacian weapon-smith can make 10 arrows or 2 bows in one hour,whereas the Roman weapon-smith needs two hours to make 10 arrows,but he can make 3 bows in two hours.Who should specialize in the production of arrows and why?
A) The Romans - because they have absolute advantage in the production of arrows
B) The Dacians - because they have absolute advantage in the production of arrows
C) The Romans - because they have comparative advantage in the production of arrows
D) The Dacians - because they have comparative advantage in the production of arrows
E) Neither - because each are better off without specialization and exchange
Correct Answer:
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