Countries X and Y's PPFs   8. Countries X and Y only produce Pizza and DVD players. To the right we show their PPFs for these two goods. Based on this graph you know that:
  1. X has an absolute advantage in DVD player production and Y has an absolute advantage in Pizza production.
  2. X has an absolute advantage in Pizza production and Y has an absolute advantage in DVD player production.
  3. X has an absolute and comparative advantage in DVD player production and Y has an absolute and comparative advantage in Pizza production.
  4. X has an absolute advantage in both DVD player and Pizza production, and a comparative advantage in DVD player production, but Y has a comparative advantage in Pizza production.
  5. X has an absolute and comparative advantage in both DVD player production and in Pizza production.

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