Table 1: Labourtime (in minutes) requirement for production of a unit of Good X and Y by Country A and B

(i) Which country among A and B has absolute advantage in producing commodity X and which
has in producing commodity Y? Give reason. 
(ii) Which country among A and B has comparative advantage in producing commodity X and
which has in producing commodity Y? Give reason. 
(iii)Suppose after trade each country specialises in production of commodity in which it has a
comparative advantage, which country will specialise in producing commodity X?

(i) Absolute Advantage:

• Country A has an absolute advantage in producing both commodities X and Y. This is because the labor time required for producing a unit of both commodities is lower in Country A compared to Country B.

(ii) Comparative Advantage:

• To determine comparative advantage, we need to calculate the opportunity cost of producing each commodity in terms of the other commodity's production.

For Country A:

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