Which country has comparative advantage in producing fish

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Reference no: EM13837865

Suppose that Kiribati can produce 1000 tons of breadfruit or 500 tons of fish, and that Tuvalu can produce 750 tons of breadfruit or 1875 tons of fish.

a. What is the opportunity cost of 1 unit of fish in Kiribati? Show your work.

b. What is the opportunity cost of 1 unit of fish in Tuvalu? Show your work.

c. Which country has a comparative advantage in producing fish? Explain why.

d. Suppose that trade takes place between Kiribati and Tuvalu. Which good will Kiribati import from Tuvalu? Explain why.

Reference no: EM13837865

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