The world is made up of Sealand and Fantasia. Both countries make two goods, X and Y. Good X requires a lot of land but only a small amount of labour. Good Y requires a lot of labour but only a small amount of land. Sealand has abundant land and labour. Fantasia has more labour than Sealand. What can be deduced from the above about Sealand?
- AIt is unlikely to gain from trade with Fantasia.
- BIt will have an absolute advantage in the production of both X and Y.
- CIt will have a comparative advantage in the production of X.
- DIt will have a comparative advantage in the production of Y.