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AP Macroeconomics 1.3: Comparative Advantage and Trade

Compare producers using output and opportunity cost data, then explain specialization and trade terms that can benefit trading partners.

Syllabus
Effective Fall 2025
Course
AP Macroeconomics

Covered syllabus points

MKT-1.A—a. Define absolute advantage and comparative advantage. b. Determine (using data from PPCs or tables as appropriate) absolute and…MKT-1.B—a. Explain (using data from PPCs or tables as appropriate) how specialization according to comparative advantage with appropriate…

1.3 Comparative Advantage and Gains from Trade question 1

[Maximum number: 2]

Sweden and Norway use equal quantities of resources to produce food and capital goods. The table below shows the maximum possible production of food OR capital goods for each country.

Table for Question 1.3 Comparative Advantage and Gains from Trade question 1 — AP Macroeconomics

Question (a)

(a)

Which country has the comparative advantage in the production of capital goods? Explain.

[ 1 ]

Question (b)

(b)

Based on the table above, identify a specific number of units of capital goods that could be traded for 10 units of food and be mutually beneficial.

[ 1 ]
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