Comparative Advantage And Specialization
The opportunity cost of producing 1 ton of corn is 5 tons of wheat for Country A and 1/3 ton of wheat for Country B. Which of the following statements is true?
A
Country A should specialize in producing corn, and Country B should specialize in producing wheat.
B
There will be no gains from trade if these two countries exchange goods.
C
Both countries should produce both goods.
D
Country B should specialize in producing corn, and Country A should specialize in producing wheat.
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