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Comparative Advantage Practice

Comparative Advantage Ninja!


Problem:
When given equivalent resources, Cape Verde Islands produces 6 milk or 3 avocado and New Caledonia produces 7 milk or 3 avocado.

What is Cape Verde Islands's opportunity cost for milk and avocado?
What is New Caledonia's opportunity cost for milk and avocado?

Who has the absolute advantage in milk?
Who has the absolute advantage in avocado?

Who has the comparative advantage in milk?
Who has the comparative advantage in avocado?


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