Suppose That the Productivity Per Worker in the Milk and Cranberry

question 75

Essay

Suppose that the productivity per worker in the milk and cranberry juice industries of Southland and Northland are as follows:
a)Which country has the absolute advantage in producing milk?
b)Which country has the absolute advantage in producing cranberry juice?
c)Which country has the comparative advantage in producing milk?
d)Which country has the comparative advantage in producing cranberry juice?
e)According to the theory of comparative advantage,will there be trade? If yes,what is the direction of trade?

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