Countries X and Y's PPFs   8. It should be clear from the graph to the right than X has an absolute advantage in production of both DVD Players and Pizzas. It can produce either 100 DVD Players or 100 Pizzas, while Y can produce either 60 DVD Players or 80 Pizzas.

   A country's comparative advantage is based on opportunity cost, not total possible output. In X, the opportunity cost of a DVD Players is 1 Pizza and the opportunity cost of a Pizza is 1 DVD Player.

   In Y, the opportunity cost of a DVD Players is 8/6 or 4/3 of a Pizza and the opportunity cost of a Pizza is 6/8 or 3/4 a DVD Player.

   Thus, Y has a comparative advantage in Pizza production and X has a comparative advantage in DVD Player production.

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