1. Business
  2. Economics
  3. suppose the united kingdom and norway both produce ol and...

Question: suppose the united kingdom and norway both produce ol and...

Question details

Suppose the United Kingdom and Norway both produce ol and fish oil, which are sold for the same prices in both countries. The following table shows combinations of both goods that each country can produce in a day, measured in thousands of barrels, using the same arnaunts of capital arnd labor United K Fish 12 ish 12 Who has the comparative advantage i preducing oil? A. Nelther country has a comperative advantage producing oll because their opportunity costs of producing ol are equal. O B. The United Kingdom has a comparative advantage producing oil becaust it can produce more ail C. Norway has a comparative advantage producing oil because it can produce more oi D The United Kingdum has a comparative advantage produing oil because ils opportunity cost of producing oil is lower Norway has a comparative advantage producing oil because its opportunity cost of producing oil is lower. O E. Can these two countries gain from trading oil and fish oil? O A. These countries can gain from trade because The United Kingdom has an absolute advantage producing oil O B. These countries can gain from trade because their opportunity costs of producing each good are the same. ⓔ C. These countries cannot gain rom trade because neither has a comparative advantage producing either good O D. These countries cannot gain from trada because neither has an absolute advantage producing either good. O E. These countries can gain from trade because Norway has an absclute advantage producing fish oil.

Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution