Suppose That Only Two Goods Are Produced in an Economy

question 62

Multiple Choice

Suppose that only two goods are produced in an economy.If a country possesses the comparative advantage in the production of one good then it:

• A) must also possess the comparative advantage in the production of the other good.
• B) must also possess the absolute advantage in the production of that good.
• C) cannot also possess the comparative advantage in the production of the other good.
• D) cannot also possess the absolute advantage in the production of that good.

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Definitions:

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