Response:
50 cartons of eggs
Clarification:
Comparative advantage refers to the economic principle where a country focuses on producing goods that it can make at lower opportunity costs compared to others.
Bottles of milk cartons of eggs
India 15 50
Indonesia 25 35
In this context, India's opportunity cost for producing 1 bottle of milk equates to 3.33 cartons of eggs. Meanwhile, Indonesia's opportunity cost for producing one bottle of milk translates to 1.4 cartons of eggs. Thus, Indonesia has a comparative advantage in bottle production due to its lower opportunity cost.
On the opposite side, India’s opportunity cost for generating one carton of eggs is 0.3 bottles of milk, compared to Indonesia’s 0.71 bottles. Hence, India has a comparative advantage in egg production due to its lower opportunity cost.
Accordingly, India will specialize in producing eggs since it holds the comparative advantage, resulting in a production of 50 cartons of eggs.
