Both countries have the same opportunity costs, but the decision comes down to specialization based
• Both countries have the same opportunity costs, but the decision comes down to specialization based on the good they can produce more efficiently relative to the other. • Country A has a comparative advantage in producing wheat because it has to give up less wine to produce wheat compared to Country B. • Country B is comparative advantageous in wine production because it has to give up fewer tons of wheat to produce wine compared to Country A. Specialization and Trade:- Country A should specialize in the production of wheat and export it as trade for wine from Country B. Country B should specialize in wine production and export it as trade for wheat from Country A. This, both countries end up benefiting with more wheat and wine than they could have produced on their own