Question

Michael can produce the following combinations of x and Y: 10X and 10Y, 5X and 15Y, and OX and 20Y combinations of X and Y: 100X and 20Y, 50X and 30Y, or OX and Vernon can produce the following 40Y. It follows that:_______

a. Michael has the comparative advantage in producing X and Vernon has the comparative advantage in producing Y
b. Michael has the comparative advantage in producing Y and Vernon has the comparative advantage in producing X.
c. Neither Michael nor Vernon has a comparative advantage in producing X
d. Neither Michael nor Vernon has a comparative advantage in producing Y.
e. There is not enough information to answer the question.

Answer 1

b. Michael has the comparative advantage in producing Y and Vernon has the comparative advantage in producing X.

Step-by-step explanation:

Given that there are the following combinations that names x and y

As it can be seen from the above combinations that Michael has the comparative benefit over the Y that indicates the less opportunity cost while on the other hand side Vernon has the comparative benefit over the X that indicates the opportunity cost

hence, the correct option is B.