Japan and China can both produce guns and rice. The country with the lowest opportunity cost of guns (in terms of rice) will

Question

Quizplus · Accepted Answer

The country with the lowest opportunity cost of guns (in terms of rice) will have a comparative advantage in guns. This means that they can produce guns at a lower opportunity cost than rice, compared to the other country. Therefore, it would be more efficient for them to specialize in producing guns and then trade with the other country for rice.

Japan and China Can Both Produce Guns and Rice