If the U.S. can produce wheat at $2 a bushel and corn at $3 bushel, while Canada can produce wheat at $3 a bushel and corn at $4 a bushel, then
A. the U.S. has an absolute advantage at producing both corn and wheat.
B. Canada has an absolute advantage at producing both corn and wheat.
C. the U.S. has an absolute advantage at producing corn, but not wheat.
D. the U.S. has an absolute advantage at producing wheat, but not corn.
A. the U.S. has an absolute advantage at producing both corn and wheat.
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What will be an ideal response?
When a perfectly competitive firm finds that its market price is below its minimum average variable cost, it will sell
A) any positive output the entrepreneur decides upon because all of it can be sold. B) nothing at all; the firm shuts down. C) the output where average total cost equals price. D) the output where marginal revenue equals marginal cost.