Assume that Colombia gives up three motorcycles for each ton of coffee it produces,while Bolivia gives up seven motorcycles for each ton of coffee it produces.Colombia has a comparative advantage in _____ production and should specialize in _____.

Question

Quizplus · Accepted Answer

coffee;coffeeColombia has a lower opportunity cost in producing coffee compared to Bolivia (3 motorcycles vs. 7 motorcycles per ton of coffee), indicating Colombia has a comparative advantage in coffee production. Therefore, Colombia should specialize in coffee.

Assume That Colombia Gives Up Three Motorcycles for Each Ton