Question

A German worker takes 500 hours to produce a car and 5 hours to produce a case of wine. A French worker takes 400 hours to produce a car and X hours to produce a case of wine. For what values of X will gains from trade be possible? Check all that apply.

Answer 1

France has an absolute advantage in the production of both sweaters and wine because it takes less labor to produce a unit of the goods compared to Tunisia.

Step-by-step explanation:

In this scenario, France has an absolute advantage in the production of both sweaters and wine. You can tell because it takes France less labor to produce a unit of the goods compared to Tunisia.

France only requires one worker to produce one sweater and one worker to produce one bottle of wine, while Tunisia needs two workers to produce one sweater and three workers to produce one bottle of wine.