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With a Given Amount of Labour and Other Resources, Producers

Question 159

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With a given amount of labour and other resources, producers in the nation of Alphania can produce either 100 widgets or 50 wackets. Thus, two widgets must be given up to produce each wacket. Using the same amount of labour and resources, producers in Betania can produce 40 widgets or 40 wackets-so one widget must be given up for each wacket produced. Based on this information, Betania has a comparative advantage in the production of wackets.

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