If Shawn can produce donuts at a lower opportunity cost than Sue, then
A) Shawn has a comparative advantage in the production of donuts.
B) Sue has a comparative advantage in the production of donuts.
C) Shawn should not produce donuts.
D) Shawn is capable of producing more donuts than Sue in a given amount of time.

Question

Quizplus · Accepted Answer

According to the definition of comparative advantage, if one producer can produce a good at a lower opportunity cost than another producer, then that producer has a comparative advantage in the production of that good. Therefore, if Shawn can produce donuts at a lower opportunity cost than Sue, then he has a comparative advantage in the production of donuts.

If Shawn Can Produce Donuts at a Lower Opportunity Cost