Mexico and Canada produce both oil and apples using labour only. A barrel of oil can be produced with 8 hours of labour in Mexico and 4 hours of labour in Canada. A bushel of apples can be produced with 12 hours of labour in Mexico and 8 hours of labour in Canada. Mexico has

Question

Quizplus · Accepted Answer

Mexico has a comparative advantage in producing apples because it has a lower opportunity cost for apples compared to oil, relative to Canada.

Mexico and Canada Produce Both Oil and Apples Using Labour