Use the following graphs of production possibilities curves to answer the next question.
Suppose the world economy is composed of just two countries: Italy and Greece. Each can produce steel or chemicals, but at the different levels of economic efficiency shown in the graphs. It can be deduced that
A. Greece has a comparative advantage in chemicals.
B. it is more costly in terms of resources to produce steel in Italy.
C. Greece has the absolute advantage in both products.
D. Italy has a comparative advantage in chemicals.
Answer: A
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