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Figure: Corn and Watches in the United States and Canada
-(Figure: Corn and Watches in the United States and Canada)Referring to the graphs,we see that the United States should export _____ to Canada and import _____ from Canada.

Question

Use the following to answer questions
Figure: Corn and Watches in the United States and Canada 
-(Figure: Corn and Watches in the United States and Canada)Referring to the graphs,we see that the United States should export _____ to Canada and import _____ from Canada.

Quizplus · Accepted Answer

The blue line (representing Canada) has a higher slope for the corn graph, indicating that Canada has a comparative advantage in producing corn. The red line (representing the United States) has a higher slope for the watches graph, indicating that the United States has a comparative advantage in producing watches. Therefore, it makes sense for the United States to export watches to Canada and import corn from Canada.

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