Bonnie can produce either 10 hats or 20 scarves in a month. Phil can produce either 5 hats or 10 scarves in a month. Therefore:

A) Phil has a comparative advantage in hats, Bonnie in scarves.
B) Bonnie has a comparative advantage in hats, Phil in scarves.
C) Phil has a comparative advantage in both hats and scarves.
D) Bonnie has a comparative advantage in both hats and scarves.
E) Neither of them has a comparative advantage in hats or scarves.

E

Economics

You might also like to view...

_____________ is defined as firm's ability to earn above-average profit

a. Resource heterogeneity b. Superior performance c. Competitive advantage d. Sustainable advantage

Economics

If unemployment is below the natural rate, GDP is below potential output

a. True b. False

Economics