According to the data in the table, A) Korea should produce both electric vehicles and gasoline vehicles B) Korea should produce electric vehicles and Japan should produce gasoline vehicles C) Korea should produce gasoline vehicles because they have the absolute advantage. D) Japan should produce gasoline vehicles because they have the absolute advantage.

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12-03-2020
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According to the data in the table, A) Korea should produce both electric vehicles and gasoline vehicles B) Korea should produce electric vehicles and Japan should produce gasoline vehicles C) Korea should produce gasoline vehicles because they have the absolute advantage. D) Japan should produce gasoline vehicles because they have the absolute advantage.

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uniquer223 uniquer223 · Answer 1 · 2020-03-23T16:44:53+01:00

Answer: B. Korea should produce electric vehicles and Japan should produce gasoline vehicles

Explanation: Even though Japan has the absolute advantage in producing both electric and gasoline powered vehicles, Korea can produce electric vehicles at a lower opportunity cost than Japan. Therefore, the countries should specialize and trade, and Korea should produce electric vehicles and Japan should produce gasoline vehicles