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emmasim [6.3K]
3 years ago
5

Suppose that Canada can produce 15units of timber or 3 units of grain. Suppose that Mexico can produce 6 units of timber or 2 un

its of grain. Which of the following is CORRECT?
a. Canada has a comparative advantage in grain production.
b. Mexico has a comparative advantage in grain production.
c. The countries would find trade mutually beneficial at a trading ratio of 1 grain for 2 timber.
d. Mexico has an absolute advantage in timber production.
Business
1 answer:
Alja [10]3 years ago
6 0

Answer: B. Mexico has a comparative advantage in grain production.

Explanation:

Comparative advantage simply means when an economy can produce a good at a lower opportunity cost than another economy.

From the information given, since Canada can produce 15units of timber or 3 units of grain. Therefore, 1 grain = 15/3 = 5 timber

On the other hand, Mexico can produce 6 units of timber or 2 units of grain. Therefore, 1 grain = 6/2 = 3 timber.

Therefore, Mexico haa a comparative advantage in grain based on the above.

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$202,200

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8 0
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Which is a stepping-stone toward future education
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A High School Diploma is a stepping-stone toward future education.

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Net working capital is significant because it provides insight into a company's liquidity and determines if it has sufficient funds to meet its immediate obligations. If the net working capital number is zero or higher, the company can meet its immediate obligations.

Learn more about net working capital: brainly.com/question/21852402

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