Poland requires 4 hours of labor to produce 1 ton of coal and 1 hour of labor to
ID: 2440183 • Letter: P
Question
Poland requires 4 hours of labor to produce 1 ton of coal and 1 hour of labor to produce a bushel of wheat. The Czech Republic requires 6 hours of labor to produce 1 ton of coal and 1 hour of labor to produce a bushel of wheat. Which country has a comparative advantage in the production of wheat? Poland the Czech Republic Neither country has a comparative advantage. Both countries have a comparative advantage. Poland requires 4 hours of labor to produce 1 ton of coal and 1 hour of labor to produce a bushel of wheat. The Czech Republic requires 6 hours of labor to produce 1 ton of coal and 1 hour of labor to produce a bushel of wheat. Which country has a comparative advantage in the production of wheat? Poland the Czech Republic Neither country has a comparative advantage. Both countries have a comparative advantage.Explanation / Answer
the Czech Republic is the correct option.
In Poland 4 hours of labor are required for 1 ton of coal. So in 1 hour, 1/4 ton of coal will be produced
Poland's Opportunity cost of production of wheat = 1/4 ton of coal
In Czech Republic 6 hours of labor are required to produce 1 ton of coal. So in 1 hour, 1/6 of coal will be produced
Czech Republic 's opportunity cost of production of wheat = 1/6 of coal
Since the opportunity Cost of producing wheat is lower in Czech Republic so it has a comparative advantage in producing wheat.