England and Scotland both produce scones and sweaters. Suppose that an English worker can produce 50 scones per hour or 1 sweater per hour. Suppose that a Scottish worker can produce 40 scones per hour or 2 sweaters per hour. workers have an absolute advantage in producing scones, and workers have an absolute advantage in producing sweaters. workers have a comparative advantage in producing scones, and workers have a comparative advantage in producing sweaters. If England and Scotland decide to trade, Scotland will trade to England. If a Scottish worker could produce only 1 sweater per hour, Scotland gain from trade, and England gain from trade.

The question is incomplete. This is the complete question:

England and Scotland both produce scones and sweaters. Suppose that an English worker can produce 50 scones per hour or 1 sweater per hour. Suppose that a Scottish worker can produce 40 scones per hour or 2 sweaters per hour. a. Which country has the absolute advantage in the production of each good? Which country has the comparative advantage? b. If England and Scotland decide to trade, which commodity will Scotland trade to England? Explain. c. If a Scottish worker could produce only 1 sweater per hour, would Scotland still gain from trade? Would England still gain from trade? Explain.

A. English workers have more advantages

1). Both countries have a comparative advantage over each other

B. Scotland will produce sweaters and trade them for scones produced in England

C. If a Scottish worker could produce only 1 sweater per hour, both countries will still benefit and gain from the trade.

Explanation:

a. The English workers have more advantages over the Scottish workers in the production of scones, since the English workers produce more scones per hour (50 vs. 40). Scottish workers have more advantage over English workers in producing the sweaters, since Scottish

workers produce more sweaters per hour (2 vs. 1). The Comparative advantage runs the

same way. The English workers, who have an opportunity cost of 1/50 sweater per scone (1

sweater per hour divided by 50 scones per hour), have a comparative advantage in the

scone production over the Scottish workers, who have an opportunity cost of 1/20 sweater

per scone (2 sweaters per hour divided by 40 scones per hour). Scottish workers on the other hand, who have an opportunity cost of 20 scones per sweater (40 scones per hour divided by 2

sweaters per hour), have a comparative advantage in sweater production over English

workers, who have an opportunity cost of 50 scones per sweater.

b.If England and Scotland decide to trade, Scotland will produce sweaters and trade them

for scones produced in England. Trade with a price between 20 and 50 scones per

sweater will benefit both countries, as they'll both be getting the traded goods at a lower price

than their opportunity cost of producing the goods in their respective country.

c.If England and Scotland decide to do the trading, Scotland will produce sweaters and trade them

for the scones produced in England. A trade with price between 20 and 50 scones per

sweater will benefit each country, as they'll be getting the traded goods at a lower price

than their opportunity cost of producing the good in their own country.

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