Determining comparative advantage

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Reference no: EM1375425

Assume that each United States worker can produce eight units of food or two units of clothing daily.

In Fredonia, which has the same number of workers, each worker can produce 7 units of food or 1 unit of clothing daily.

Why does the United States have an absolute advantage in both goods? Which country enjoys a comparative advantage in food? Why?

Reference no: EM1375425

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