Question

D Question 7 1 pts Assume Nebraska and Virginia each have 100 acres of farmland. The following table gives hypothetical figures for yield per acre in the two states: Suppose the two states decide that they want to produce 140 total units of cotton. What is the maximum amount of wheat that they could produce? Nebraska Virginia Wheat Cotton O 760 units of wheat D 1050 units of wheat D/1360 units of wheat 1220 units of wheat None of these

Answer 1

Solution: 1220 units of wheat

Explanation: Nebraska holds comparative advantage in the cotton production thus would produce the cotton. It would require 20 acres of land. Nebraska could then use its other 80 acres of land for the wheat production, thus yielding 720 units of wheat. The Virginia could also use all 100 acres for the production of wheat thus yield 500 units of wheat. Therefore the combined total equals 1220 units of wheat.