Use the accompanying table to answer the following questions.
Table 3-4

-According to Table 3-4:
A) England has an absolute advantage in bread, and Spain has a comparative advantage in cheese
B) England has an absolute advantage in bread, and Spain has a comparative advantage in neither goods
C) England has an absolute advantage in cheese, and Spain has a comparative advantage in both goods
D) England has an absolute advantage in both goods, and Spain has a comparative advantage in cheese

Question

Use the accompanying table to answer the following questions.
Table 3-4
 
-According to Table 3-4:
A) England has an absolute advantage in bread, and Spain has a comparative advantage in cheese 
B) England has an absolute advantage in bread, and Spain has a comparative advantage in neither goods 
C) England has an absolute advantage in cheese, and Spain has a comparative advantage in both goods 
D) England has an absolute advantage in both goods, and Spain has a comparative advantage in cheese

Quizplus · Accepted Answer

England has lower opportunity cost for both bread and cheese production compared to Spain, therefore they have an absolute advantage in both goods. However, Spain has a comparative advantage in cheese because they have a lower opportunity cost for cheese production relative to bread production compared to England.

Use the Accompanying Table to Answer the Following Questions