Question

Suppose the only input in agriculture is time and the following chart depicts the time it took for the Middle Colonies and New England to produce barley and milk. Using the principle of comparative advantage, what would be the most efficient solution

Answer 1

New England produces milk and the Middle Colonies manufactures barley.

Step-by-step explanation:

Using the principle of Comparative advantage (which is an economic expression that refers to an economy's capability to manufacture goods and services at a lesser opportunity cost than that of its trade partners.) when theirs is a comparative advantage, companies will now have the ability to sell goods and services at a lower price than its rival companies and also realize stronger sales margins.

So in using this principle, New England produces milk and the Middle Colonies produce barley.