Multiple Choice
Given the following Ricardo-type table shows the labor input required per unit of output in each of the two industries in each of the two countries:
Which one of the following statements is true?
A) The United Kingdom has an absolute advantage in both goods and a comparative Advantage in cloth.
B) The pretrade price ratio in the United Kingdom is 1 steel:2 cloth.
C) The United Kingdom has an absolute advantage in neither good but a comparative Advantage in steel.
D) The pretrade price ratio in Germany is 1 cloth:1.5 steel.
Correct Answer:

Verified
Correct Answer:
Verified
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