Consider two countries, Vietnam and the United States which produce two agricultural goods, rice and wheat. The table below shows the total amount of acreage devoted to farming in each country and how much rice or wheat can be grown if one acre of land is devoted to rice or wheat production.

What is the opportunity cost of producing rice in US??

" " producing wheat in US??

" " producing rice in Vietnam?

" " producing wheat in Vietname??

                              Total acreage    Rice grown on 1 acre   Wheat grown on 1 acre

United States         500,000 acres             100 lbs.                    500 lbs.

Vietnam                100,000 acres             1000 lbs.                   100 lbs.

Confirm the existence of comparative advantage by computing opportunity costs and filling in the table below. What is the pattern of comparative advantage?

Opportunity Cost

                                  Rice                   Wheat

United States          Question 1             Question 2

Vietnam                 Question 3              Question 4