Use the following to answer questions:
-(Table: The Production Possibilities for Tractors and Crude Oil)Use Table: The Production Possibilities for Tractors and Crude Oil.The opportunity cost of _____ is _____ in Canada as/than in Mexico.

Question

Use the following to answer questions: 
-(Table: The Production Possibilities for Tractors and Crude Oil)Use Table: The Production Possibilities for Tractors and Crude Oil.The opportunity cost of _____ is _____ in Canada as/than in Mexico.

Quizplus · Accepted Answer

According to the production possibilities table, Canada can produce fewer tractors but more crude oil than Mexico. This implies that Canada has a comparative advantage in producing crude oil while Mexico has a comparative advantage in producing tractors. Therefore, the opportunity cost of producing tractors in Canada is lower than in Mexico, while the opportunity cost of producing crude oil is higher in Canada. Thus, the correct answer is C, tractors have a lower opportunity cost in Canada than in Mexico.

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