Th4.1: Diagrammatic Approach One Flashcards
1
Q
Refer to PP
Look at Graph 13. Which country has an absolute advantage in both and why?
A
Country 1 as they can produce more of both
2
Q
Refer to PP
Look at Graph 1. However, why is trading not worthwhile for country 1?
A
they have the same opportunity cost since the gradients of the line are the same
