Country A can produce cars using eight workers in a day and a fridge using three workers in a day where as in country B a car requires six workers and a fridge requires two workers per day. Which of the following statement is true?
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Theories of international trade has come up 151 times in 6 exams since 2006.
This question is on Absolute and comparative advantage, part of Theories of international trade in International Economics.
Why countries trade: producing more cheaply in absolute terms, or at lower opportunity cost.
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Question from the UoH 2012 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.