One scarf takes 3/5 of a yard. Two of these takes 6/5 of a yard. If we put the 1 7/10 into an improper fraction we would get 17/10. So in order to compare the two fractions, the 6/5 and the 17/10, they have to have the same denominator. 6/5 can be rewritten as 12/10. 12/10 is less that the 17/10 you have, so yes you can make two scarves with that amount of fabric.
