If Iowa's opportunity cost of corn is lower than Oklahoma's opportunity cost of corn, then
A)Iowa has a comparative advantage in the production of corn.
B)Iowa has an absolute advantage in the production of corn.
C)Iowa should import corn from Oklahoma.
D)Oklahoma should produce just enough corn to satisfy its own residents' demands.

Question

Quizplus · Accepted Answer

A lower opportunity cost means Iowa can produce corn more efficiently relative to other goods than Oklahoma can, indicating a comparative advantage. Absolute advantage, trade decisions, and production strategies for self-sufficiency are not directly determined by comparative opportunity costs.

If Iowa's Opportunity Cost of Corn Is Lower Than Oklahoma's