Question 1 OTU
3 Points
Suppose company A can produce shovels for $8 each, axes for 512 each, and
rakes for $15 each. Company B can produce shovels for $10 each, axes for
$11 each, and rakes for $17 each. Company A sells each item for $5 more
than its production cost. Company B sells shovels for $13, axes for $15, and
rakes for $18
Which of the following statements is true?
O
A. Company B has a comparative advantage in the production of
shovels
B. Company A has a comparative advantage in the production of
rakes
C. Company has a comparative advantage in the production of
D. Company A has a comparative advantage in the production of
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