Multiple Choice
Consider the following information about the production of two goods,X and Y,in two countries,A and B:
∙ In Country A it takes Xa units of resources to produce one unit of X and Ya units of resources to produce one unit of Y.
∙ In Country B it takes Xb units of resources to produce one unit of X and Yb units of resources to produce one unit of Y.
∙ Assume the amount of resources used to produce the goods in the two countries can be compared unambiguously.
-Refer to Table 32-1.If is less than
,we can conclude with certainty that
A) The opportunity cost of producing good X in Country A is less than in Country B.
B) Country A has a comparative advantage in the production of good X.
C) Country A has an absolute advantage in the production of good X.
D) The price of good X in Country A is less than the price in Country B.
E) The opportunity cost of producing good X in Country A is higher than in Country B.
Correct Answer:

Verified
Correct Answer:
Verified
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