Asked by Taran Thiara on Jun 07, 2024

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Romania has a comparative advantage in the production of

A) basketballs.
B) Barbie dolls.
C) both basketballs and Barbie dolls.
D) neither basketballs nor Barbie dolls.

Comparative Advantage

Comparative advantage is an economic principle that describes how a country can gain by producing goods and services for which it has a lower opportunity cost than other countries.

Nigerian Worker

An individual employed in Nigeria, notable for discussing work issues relevant to the social, economic, and environmental context of Nigeria.

  • Attain insight into the theories of absolute and comparative advantage as they apply to international trade dynamics.
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Verified Answer

HH
Heather HarrisJun 10, 2024
Final Answer :
A
Explanation :
Romania has a comparative advantage in the production of basketballs because it gives up fewer Barbie dolls to produce one more basketball compared to Nigeria (1.5 dolls per basketball for Romania vs. 2 dolls per basketball for Nigeria). Comparative advantage is determined by the opportunity cost of producing goods.