Table 3.2
-Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Which of the following is true?
A) Rose has a comparative advantage in producing coconuts but not fish.
B) Rose has a comparative advantage in producing fish but not coconuts.
C) Rose has a comparative advantage in producing both goods.
D) Rose does not have a comparative advantage in producing either good.

Question

Table 3.2
-Consider two individuals,Rose and Sharon,who produce fish and coconuts.Rose and Sharon's hourly productivity are shown in Table 3.2.Which of the following is true?
A) Rose has a comparative advantage in producing coconuts but not fish. 
B) Rose has a comparative advantage in producing fish but not coconuts. 
C) Rose has a comparative advantage in producing both goods. 
D) Rose does not have a comparative advantage in producing either good.

Quizplus · Accepted Answer

Comparative advantage is determined by comparing opportunity costs. If Rose has a lower opportunity cost for producing coconuts than Sharon, then she has a comparative advantage in coconuts. The problem statement suggests this is the case.

Table 3.2 -Consider Two Individuals,Rose and Sharon,who Produce Fish and Coconuts.Rose and Coconuts.Rose