Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
A → B → C → D
B
C → A → B → D
C
B → A → D → C
D
A → C → B → D
Understanding the Answer
Let's break down why this is correct
Answer
To determine which country should specialize in producing a good based on comparative advantage, you first need to identify the opportunity costs of producing goods in both countries. This means figuring out what each country gives up to make one good instead of another. Next, you compare these opportunity costs to find which country has the lower cost for producing each good. After that, you can look at the absolute advantages to see which country is better at producing a good overall, but this step is not always necessary. Finally, based on your comparisons, you decide which country should specialize in which good, so they can trade and both benefit.
Detailed Explanation
First, you find out the opportunity costs for each country. Other options are incorrect because This option starts with absolute advantages, which are about who can produce more; This option compares opportunity costs after looking at absolute advantages.
Key Concepts
Comparative Advantage
Opportunity Cost
Absolute Advantage
Topic
Understanding Comparative Advantage
Difficulty
easy level question
Cognitive Level
understand
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