Refer to the Information Provided in Figure 19

question 58

Multiple Choice

Refer to the information provided in Figure 19.1 below to answer the questions that follow.
Figure 19.1
-Refer to Figure 19.1.Which of the following statements is TRUE?

• A)Only Canada can benefit from trade because the United States has an absolute advantage in the production of both soybeans and alfalfa.
• B)Trade will benefit both countries because the United States has a comparative advantage in the production of soybeans and Canada has a comparative advantage in the production of alfalfa.
• C)Trade will benefit both countries because the United States has a comparative advantage in the production of alfalfa and Canada has a comparative advantage in the production of soybeans.
• D)Trade will benefit neither country because the United States has an absolute advantage in the production of both soybeans and alfalfa,but Canada has a comparative advantage in the production of both soybeans and alfalfa.

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Definitions:

Advanced Technologies

Modern and cutting-edge technologies that offer significant improvements over existing technologies in terms of performance, efficiency, or capabilities.

Expensive Labor

Refers to labor that has a high cost, often due to skills, experience, or wage regulations that increase the compensation required to employ workers.

Resource Endowments

The natural resources, capital, and human skills that a country or region has available for economic production.

World Bank

An international financial institution that offers loans, grants, and expert advice to developing countries for economic development projects.