Post Utme Bowen University 2020 Commerce Question 26

Practice objective / multiple choice question 26 from the 2020 Post Utme Bowen University Commerce examination.

Post Utme Bowen University 2020 Commerce Objective / Multiple Choice
Question 26 POST_UTME_BOWEN_UNIVERSITY • 2020 • COMMERCE • objective

The concept of comparative advantage in international trade is based on the idea that countries should specialize in producing goods for which they have a lower opportunity cost compared to other countries. Which of the following is a correct example of comparative advantage?

Answer Options

A. A country that can produce 100 units of wheat with the same amount of labor as 50 units of rice has a comparative advantage in producing wheat.
Correct Answer B. A country that can produce 50 units of wheat with the same amount of labor as 100 units of rice has a comparative advantage in producing wheat.
C. A country that can produce 100 units of wheat with the same amount of labor as 100 units of rice has a comparative advantage in producing wheat.
D. A country that can produce 50 units of wheat with the same amount of labor as 50 units of rice has a comparative advantage in producing wheat.
Correct Answer
B
Correct Option:
A country that can produce 50 units of wheat with the same amount of labor as 100 units of rice has a comparative advantage in producing wheat.

About This Question

This is Post Utme Bowen University 2020 Commerce Question 26. It is one of the objective questions from the 2020 Post Utme Bowen University Commerce examination.

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