-In the figure above, both Joe and Jill initially produce at point A. If Joe and Jill realise that they each possess a comparative advantage, which outcome can we expect?
A)Joe will specialise in shirts and Jill will specialise in pants.
B)Joe will specialise in pants and Jill will specialise in shirts.
C)Joe and Jill each will be able to consume more than 2 shirts and 2 pairs of pants.
D)Both answers B and C are correct.

Question

-In the figure above, both Joe and Jill initially produce at point A. If Joe and Jill realise that they each possess a comparative advantage, which outcome can we expect?
A)Joe will specialise in shirts and Jill will specialise in pants. 
B)Joe will specialise in pants and Jill will specialise in shirts. 
C)Joe and Jill each will be able to consume more than 2 shirts and 2 pairs of pants. 
D)Both answers B and C are correct.

Quizplus · Accepted Answer

If Joe and Jill realize their comparative advantages, they will specialize in the production of the good for which they have a lower opportunity cost. This specialization allows them to trade and consume more than they could individually produce, leading to both B and C being correct.

-In the Figure Above, Both Joe and Jill Initially Produce