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AP® Macroeconomics

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Moderate

Absolute Advantage: Wheat and Corn

APMACR-1V5YO6

Aruba can produce 10 units of wheat and 20 units of Corn. Bermuda can produce 40 units of wheat and 40 units of Corn given the same number of resources.

Which of the following is true?

A

Aruba has the comparative advantage in the production of wheat.

B

Aruba has the absolute advantage in the production of corn.

C

Bermuda has the absolute advantage in the production of wheat.

D

Bermuda should specialize in the production of corn.

E

Aruba has the absolute advantage in the production of wheat.