4. Which of the following situations illustrate the sources of comparative advantage?
A country uses its extensive network of fiber-optic cable to produce IT services
A country in the southern hemisphere specializes in growing grapes
All of the above
A country produces olives that can only grow in a Mediterranean climate
A country specialized in medical equipment which relies on the highly-skilled labors
Answer - All the above options
The comparitive advantage means that the country should produce that good which it can produce the best and in which it has a cost advantage.
Hence this condition can be seen in all the above options . All the options show that the countries are manufacturing in which they are the best hence they enjoy the comparitive advantage.
4. Which of the following situations illustrate the sources of comparative advantage? A country uses its...