Suppose that opportunity costs are constant in both France and Italy. In France, maximum feasible hourly production levels are either 3 units of wheat or 5 units of wine. In Italy, maximum feasible hourly production levels are either 4 units of wheat or 10 units of wine. It is correct to state that OA. Italy has a comparative advantage in producing wine. OB. France has a comparative advantage in producing both wheat and wine. OC. Italy has a comparative advantage in producing both wheat and wine. O D. France has a comparative advantage in producing wine.
Suppose that opportunity costs are constant in both France and Italy. In France, maximum feasible hourly production levels are either 3 units of wheat or 5 units of wine. In Italy, maximum feasible hourly production levels are either 4 units of wheat or 10 units of wine. It is correct to state that OA. Italy has a comparative advantage in producing wine. OB. France has a comparative advantage in producing both wheat and wine. OC. Italy has a comparative advantage in producing both wheat and wine. O D. France has a comparative advantage in producing wine.
Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter2: Some Tools Of The Economist
Section: Chapter Questions
Problem 7CQ
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