England and Scotland both produce scones and sweaters. Suppose that an English worker can produce 30 scones per hour or 2 sweate r per hour. Suppose that a Scottish worker can produce 40 scones per hour or 4 sweaters per hour. Who will produce sweaters?
1 answer:
Answer:
Step-by-step explanation:
Scones Sweaters
England 30 2
Scotland 40 4
The opportunity cost calculation:
Opportunity Cost
England Scotland
1 Scone 0.066 Sweaters 0.1 Sweaters
1 Sweater 15 Scones 10 Scones
England has comparative advantage in production of Scones; Scotland has comparative advantage in production of Sweaters.
Scotland will produce Sweaters
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