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Suppose that for each pound of wheat that country X produces it must forego the production of 25 pounds of coffee and that for each pound of wheat that country Y produces it must forego the production of 10 pounds of coffee. It follows that:

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Country Y has a comparative advantage in wheat production over Country X, as it has a lower opportunity cost for producing wheat, exemplified by the comparative advantages of the US (wheat) and Brazil (sugar cane). Transferring labor toward areas of comparative advantage can increase production efficiency in both countries.

The question you're asking relates to opportunity cost and the principle of comparative advantage in economics. It implies that Country X has a higher opportunity cost of producing wheat than Country Y because for each pound of wheat that Country X produces, it forgoes the production of 25 pounds of coffee, whereas Country Y only forgoes 10 pounds of coffee for each pound of wheat produced. Thus, Country Y has a comparative advantage in producing wheat.

Using the example of the US and Brazil, Brazil has a lower opportunity cost of producing sugar cane (in terms of wheat) than the US, giving Brazil a comparative advantage in sugar cane production. Conversely, the US can produce wheat at a lower opportunity cost than Brazil, granting it a comparative advantage in wheat production. When both countries focus on producing goods for which they have a comparative advantage, overall production efficiency and economic welfare can be increased.

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