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Canada produces MP3 players and lumber, and the marginal costs for the two products are $200 per ...

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Canada produces MP3 players and lumber, and the marginal costs for the two products are $200 per ...

Canada produces MP3 players and lumber, and the marginal costs for the two products are $200 per 1,000 board-feet of lumber and $100 per MP3 player. China also produces these goods, and the marginal costs are $300 per 1,000 board-feet of lumber and $100 per MP3 player. Which country has the comparative advantage in lumber production?
A) Canada
B) China
C) Both countries share the comparative advantage.
D) We need more information to answer this question.

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Microeconomics

Edition: 8^th

Author: Pindyck

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