The chart shows a production possibilities schedule for Sabrina's Soccer.

Stan's Sporting Goods is a competitor that can manufacture seven soccer balls out of a possible ten, if it makes one soccer net. Which statement correctly compares the two businesses?

Sabrina's Soccer has a comparative advantage over Stan's Sporting Goods because Sabrina's Soccer has a lower opportunity cost.

Stan's Sporting Goods has a comparative advantage over Sabrina's Soccer because Stan's Sporting Goods has a lower opportunity cost.

Sabrina's Soccer has an absolute advantage over Stan's Sporting Goods because Sabrina's Soccer has a lower production cost.

Stan's Sporting Goods has an absolute advantage over Sabrina's Soccer because Stan's Sporting Goods has a lower production cost.

Question

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Talan Branch

7 November, 02:28

The chart shows a production possibilities schedule for Sabrina's Soccer.

Stan's Sporting Goods is a competitor that can manufacture seven soccer balls out of a possible ten, if it makes one soccer net. Which statement correctly compares the two businesses?

Sabrina's Soccer has a comparative advantage over Stan's Sporting Goods because Sabrina's Soccer has a lower opportunity cost.

Stan's Sporting Goods has a comparative advantage over Sabrina's Soccer because Stan's Sporting Goods has a lower opportunity cost.

Sabrina's Soccer has an absolute advantage over Stan's Sporting Goods because Sabrina's Soccer has a lower production cost.

Stan's Sporting Goods has an absolute advantage over Sabrina's Soccer because Stan's Sporting Goods has a lower production cost.

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Answers (2)

Know the Answer?

Armani Spence · Answer 1

The answer is "Sabrina's Soccer has a comparative advantage over Stan's Sporting Goods because Sabrina's Soccer has a lower opportunity cost." Based from my research opportunity cost is the loss of potential gain from other alternatives when one alternative is chosen.

Jane Haynes · Answer 2

a) Sabrina’s Soccer has a comparative advantage over Stan’s Sporting Goods because Sabrina’s Soccer has a lower opportunity cost.