Who has the comparative advantage in producing wine and who has the comparative advantage in producing schnitzel? A. France has a comparative advantage producing wine and schnitzel. B. France has a comparative advantage producing schnitzel and Germany has a comparative advantage producing wine. C. Neither has a comparative advantage producing wine or schnitzel. D. Germany has a comparative advantage producing wine and schnitzel. E. France has a comparative advantage producing wine and Germany has a comparative advantage producing schnitzel

France has a comparative advantage producing wine and Germany has a comparative advantage producing schnitzel.

Answer: Option E.

Explanation:

Wine is an alcoholic drink, whereas schnitzel is basically a slice of meat which is fried in fat. When it comes to production of wine and schnitzel in France and Germany, we can say that France has a comparative advantage producing wine and Germany has a comparative advantage producing schnitzel. Say for example: When France manufacturers one bottle of wine, it manufacture two fewer pounds of schnitzel. Similarly, when Germany produces 1 more bottle of wine, it produces 3 fewer pounds of schnitzel. Thus, France's chance of producing wine-2 pounds of schnitzel-is less than Germany's-3 pounds of schnitzel.