Assume Japan Must Forego Producing 60 Computers for Each Automobile

question 97

Multiple Choice

Assume Japan must forego producing 60 computers for each automobile it produces.Moreover,the United States can produce one automobile if it forgoes producing 80 computers.Which of the following is true?

• A)The United States has a lower opportunity cost of producing automobiles.
• B)The United States has a comparative advantage in producing automobiles.
• C)Japan has a comparative advantage in producing computers.
• D)No trade will occur between Japan and the United States.
• E)Japan has a lower opportunity cost of producing automobiles.

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