MC Qu 113 Use the following table to answer Use the followin

MC Qu. 113 Use the following table to answer... Use the following table to answer the question below Giovannis Production Jorge\'s Production Possibilities Possibillties Schedule Schedule Pounds of Pounds of Pounds of Pounds of Corn Green Beans 0 40 80 120 160 Corn 160 120 80 40 0 Green Beans 0 20240 40 160 ?? 801 80 0 Glovanni should specialize In the production of which good? Multiple Choice com green beans

Solution

Option 2. Green Beans

Explanation:

Giovanni\'s opportunity cost of producing 160 pounds of green beans = 160 pounds of corn.

Therefore, Giovanni\'s opportunity cost of producing 1 pound of green beans = 160/160 = 1 pound of corn.

Similarly, Giovanni\'s opportunity cost of producing 1 pound of corn = 160/160 = 1 pound of green beans.

On the other hand, George\'s opportunity cost of producing 1 pound of green beans = 320/80 = 4 pounds of corn.

And, George\'s opportunity cost of producing 1 pound of corn = 80/320 = 1/4 = 0.25 pound of green beans.

Therefore, Giovanni has a lower opportunity cost in the production of green beans i.e. Giovanni has a comparative advantage in green beans.