For each watch that Switzerland produces, it gives up the ...

[fnuegbu]

For each watch that Switzerland produces, it gives up the opportunity to make 50 pounds of chocolate. Germany can produce 1 watch for every 100 pounds of chocolate it produces.
 
  Which of the following is true about the comparative advantage between the two countries?
  A) Switzerland has the comparative advantage in chocolate.
  B) Germany has the comparative advantage in watches and chocolate.
  C) Germany has the comparative advantage in watches.
  D) Switzerland has the comparative advantage in watches.

Question 2

Explain why firms' short-run marginal cost curves often initially decreases and then increases.
 
  What will be an ideal response?

[mohan]

Answer to Question 1

D

Answer to Question 2

Diminishing marginal returns and specialization causes the MC curve to be U-shaped.

[fnuegbu]

TYSM

[ashely1112]

Thanks for the timely response, appreciate it