Suppose Brazil has an absolute advantage over other countries in producing almonds,but other countries have a comparative advantage over Brazil in producing almonds.If trade in almonds is allowed,Brazil
A)will import almonds.
B)will export almonds.
C)will either import almonds or export almonds,but it is not clear from the given information.
D)would have nothing to gain either from exporting or importing almonds.

Question

Quizplus · Accepted Answer

Absolute advantage means that Brazil is able to produce almonds using fewer resources (such as labor) than other countries. However, comparative advantage takes into account the opportunity cost of producing almonds. If other countries have a lower opportunity cost, they will specialize in producing almonds and Brazil will specialize in producing other goods. This leads to the situation where Brazil would import almonds from other countries that have a comparative advantage in producing almonds. Therefore, the correct answer is A.

Suppose Brazil Has an Absolute Advantage Over Other Countries in Producing