Essay
Suppose that in Germany, the opportunity cost of producing a gallon of beer is 5 gallons of wine.In Italy, the opportunity cost of producing a gallon of beer is 3 gallons of wine.
a.What is the opportunity cost of producing a gallon of wine for Germany?
b.What is the opportunity cost of producing a gallon of wine for Italy?
c.Which country has a comparative advantage in the production of beer?
d.Which country has a comparative advantage in the production of wine?
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a.For Germany, the opportunity cost of p...View Answer
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Correct Answer:
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