If Country a Has a Lower Opportunity Cost of Producing

question 162

Multiple Choice

If country A has a lower opportunity cost of producing cars than country B, then country A has

• A)a comparative advantage in car production and country B has an absolute advantage in car production.
• B)an absolute advantage in car production.
• C)a comparative advantage in car production.
• D)an absolute and a comparative advantage in car production.
• E)no reason to trade with country B.

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Definitions:

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