Two Persons Each Produce Two Identical Goods

question 209

Multiple Choice

Two persons each produce two identical goods. Which of the following is true about their absolute and comparative advantages in the production of these two goods?

• A) One person can have an absolute advantage in both goods but not a comparative advantage in both goods.
• B) One person can have a comparative advantage in both goods but not an absolute advantage in both goods.
• C) One person can have neither an absolute nor a comparative advantage in either good.
• D) Both persons can always have both an absolute and comparative advantage in both goods.

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Definitions:

Attitudes

A psychological tendency expressed by evaluating a particular entity with some degree of favor or disfavor.

Motives

Internal driving forces that cause a person to take action or behave in a particular way.

Knowledge Function

The role or purpose that knowledge serves in an organizational or systemic context, facilitating decision-making, problem-solving, and innovation.

Katz

Refers to a surname or can relate to theories or models proposed by individuals with the surname Katz in various academic fields.