Table 3-20
Assume that Brad and Theresa can switch between producing wheat and producing beef at a constant rate.
-Refer to Table 3-20. Brad has a comparative advantage in the production of
A)wheat and Theresa has a comparative advantage in the production of beef.
B)beef and Theresa has a comparative advantage in the production of wheat.
C)both goods and Theresa has a comparative advantage in the production of neither good.
D)neither good and Theresa has a comparative advantage in the production of both goods.

Question

Table 3-20
Assume that Brad and Theresa can switch between producing wheat and producing beef at a constant rate. 
-Refer to Table 3-20. Brad has a comparative advantage in the production of
A)wheat and Theresa has a comparative advantage in the production of beef. 
B)beef and Theresa has a comparative advantage in the production of wheat. 
C)both goods and Theresa has a comparative advantage in the production of neither good. 
D)neither good and Theresa has a comparative advantage in the production of both goods.

Quizplus · Accepted Answer

Brad has a lower opportunity cost of producing beef compared to producing wheat (1/2 vs. 2) while Theresa has a lower opportunity cost of producing wheat compared to producing beef (2/3 vs. 3). Therefore, Brad has a comparative advantage in beef and Theresa has a comparative advantage in wheat.

Table 3-20 Assume That Brad and Theresa Can Switch Between Producing Wheat