Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Country A can produce both cars and textiles more efficiently than Country B.
B
Country A specializes in textiles because it has a lower opportunity cost than cars compared to Country B.
C
Country A produces only cars, while Country B produces only textiles to maximize production.
D
Both Country A and Country B produce the same amount of cars and textiles equally.
Understanding the Answer
Let's break down why this is correct
Answer
Comparative advantage is when a person or country can produce a good or service at a lower opportunity cost than others. This means they give up less of one thing to produce something else. For example, imagine two friends: Alex can make 10 sandwiches or 5 salads in an hour, while Jamie can make 8 sandwiches or 4 salads in the same time. If Alex focuses on making sandwiches and Jamie focuses on salads, they can trade and both end up with more of what they want. This way, each person uses their time and skills in the most efficient way, showing how trade based on comparative advantage benefits everyone involved.
Detailed Explanation
Country A has a comparative advantage in textiles. Other options are incorrect because This option suggests that one country is better at everything; This choice shows two countries only making one product each.
Key Concepts
Comparative Advantage
Opportunity Cost
Absolute Advantage
Topic
Absolute and Comparative Advantage
Difficulty
medium level question
Cognitive Level
understand
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