Please give me correct answer and full explanation otherwise i give downvote Note:-Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism.Answer completely and accurate answer.Rest assured, you will receive an upvote if the answer is accurate. 1. There are two firms, firms A and B. Suppose that the two firms both produce Jam and butter and sell them for the same price. Shown below are the combinations of thetwo goods each firm can produce using the same amounts of labor and capital. Using the information below, which answer provides the most accurate depiction ofcomparative advantage and absolute advantage?Exhibit 1Firm AFirm BJamButterJamButter120010020902080406040606030604080080201000Firm B has a comparative advantage in butter, and absolute advantage in jam.Firm B has a comparative advantage in butter, and absolute advantage in jam.Firm B has a comparative advantage in butter, and absolute advantage in jam.Firm A has a comparative advantage in jam, and an absolute advantage in jam.

The notion examined in the question is founded on the economic concepts of absolute and comparative…

Answered: Firm B has a comparative advantage in…

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter3: Interdependence And The Gains From Trade

Section: Chapter Questions

Problem 5PA

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Please give me correct answer and full explanation otherwise i give downvote Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism. Answer completely and accurate answer. Rest assured, you will receive an upvote if the answer is accurate.

1. There are two firms, firms A and B. Suppose that the two firms both produce Jam and butter and sell them for the same price. Shown below are the combinations of the
two goods each firm can produce using the same amounts of labor and capital. Using the information below, which answer provides the most accurate depiction of
comparative advantage and absolute advantage?
Exhibit 1
Firm A
Firm B
Jam
Butter
Jam
Butter
120
0
100
20
90
20
80
40
60
40
60
60
30
60
40
80
0
80
20
100
0
Firm B has a comparative advantage in butter, and absolute advantage in jam.
Firm B has a comparative advantage in butter, and absolute advantage in jam.
Firm B has a comparative advantage in butter, and absolute advantage in jam.
Firm A has a comparative advantage in jam, and an absolute advantage in jam.

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