Problem 29c

Introduction

When To calculate comparative advantage, also find the opportunity cost of producing one barrel of oil in both countries.

Then The country with the lowest opportunity cost has a comparative advantage.

When In economic terms, a country has a comparative advantage also when it can produce at a lower opportunity cost than that of trade partners.

While a country cannot have a comparative advantage in all goods and services, when it can have an absolute advantage in producing all goods.

Thus, that Comparative advantage is what you do best while also giving up the least.