Final answer:
The question deals with absolute and comparative advantage in the context of oil and corn production by Saudi Arabia and the United States. saudi Arabia has an absolute advantage in oil, while the U.S. has it in corn. Comparative advantage is determined by which country has a lower opportunity cost in producing a good.
Step-by-step explanation:
The subject at hand involves absolute and comparative advantage, concepts typically studied within the field of economics, more specifically within the context of international trade. The example provided highlights a scenario with two countries, Saudi Arabia and the United States, and two products, oil and corn. According to Table 33.1, Saudi Arabia can produce a barrel of oil with fewer labor hours than the United States, thereby having an absolute advantage in oil production. Conversely, the United States has an absolute advantage in producing corn.
Comparative advantage, although not directly stated, is about a country producing a good at a lower opportunity cost than another. Even if a country has an absolute advantage in both goods, it can still benefit from specializing in the product for which it has a comparative advantage and trading for the other.