Questions: Given the comparative opportunity costs as revealed by the PPFs shown above, the comparative advantage for country B lies in After these two countries specialize and trade with each other, country A will be importing

Given the comparative opportunity costs as revealed by the PPFs shown above, the comparative advantage for country B lies in 
After these two countries specialize and trade with each other, country A will be importing
Transcript text: Given the comparative opportunity costs as revealed by the PPFs shown above, the comparative advantage for country B lies in $\square$ After these two countries specialize and trade with each other, country A will be importing $\square$
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Solution

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To answer the question, we need to understand the concept of comparative advantage and how it relates to the production possibilities frontiers (PPFs) of the two countries, A and B. Comparative advantage occurs when a country can produce a good at a lower opportunity cost than another country.

  1. Comparative Advantage for Country B:

    • To determine the comparative advantage, we need to compare the opportunity costs of producing goods in both countries. The PPFs (Production Possibility Frontiers) would show the trade-offs between two goods.
    • If the PPFs indicate that country B has a lower opportunity cost for producing a particular good compared to country A, then country B has a comparative advantage in that good.
    • Without specific details from the PPFs, we cannot definitively fill in the blank. However, the answer would be the good for which country B has a lower opportunity cost.
  2. Country A's Imports:

    • After countries A and B specialize according to their comparative advantages and trade, each country will export the good for which it has a comparative advantage and import the other good.
    • Therefore, country A will import the good for which it does not have a comparative advantage.
    • Again, without specific details from the PPFs, we cannot definitively fill in the blank. However, the answer would be the good for which country A does not have a comparative advantage.

In summary, to fill in the blanks, we need specific information from the PPFs to determine the opportunity costs and comparative advantages. The general principle is that each country will specialize in the production of the good for which it has a comparative advantage and trade for the other good.

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