Suppose that with 1 unit of labor, Canada can produce 40 TVs or 20 computers. With 1 unit of labor, Taiwan can produce 30 TVs or 10 computers. Which of the following is correct?
A. Taiwan has a comparative advantage in the production of computers.
B. Canada has an absolute advantage in the production of neither good.
C. Canada has a comparative advantage in the production of computers.
D. Taiwan has an absolute advantage in the production of computers.
E. Taiwan has an absolute advantage in the production of TVs.
Answer: C
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