Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Country A
B
Country B
C
Neither Country A nor Country B
D
Both countries have the same advantage
Understanding the Answer
Let's break down why this is correct
Answer
To determine which country has a comparative advantage in producing cheese, we need to look at how much cheese each country gives up to produce wine. In Country A, if it chooses to produce one unit of cheese, it gives up producing 2 units of wine because it can make 10 units of wine or 5 units of cheese. In contrast, Country B gives up 3 units of wine to produce one unit of cheese since it can make 6 units of wine or 2 units of cheese. Since Country A gives up fewer units of wine than Country B to produce cheese, Country A has a comparative advantage in cheese production. Therefore, Country A should focus on making cheese while Country B should focus on making wine to maximize efficiency.
Detailed Explanation
Country B has a lower opportunity cost for cheese. Other options are incorrect because Some might think Country A is better at making cheese; This choice suggests that neither country is better at making cheese.
Key Concepts
opportunity cost
Topic
Comparative Advantage Analysis
Difficulty
easy level question
Cognitive Level
understand
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