Authors libby rittenberg 71
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advantage in snowboard production (the good on the horizontal axis)
because its production possibilities curve is the flattest of the three curves.
Figure 2.5 The Combined Production Possibilities Curve for Alpine
Sports
The curve shown combines the production possibilities curves for each
plant. At point A, Alpine Sports produces 350 pairs of skis per month
and no snowboards. If the firm wishes to increase snowboard
production, it will first use Plant 3, which has a comparative
advantage in snowboards.
Plant 3’s comparative advantage in snowboard production makes a crucial
point about the nature of comparative advantage. It need not imply that a
particular plant is especially good at an activity. In our example, all three
plants are equally good at snowboard production. Plant 3, though, is the
least efficient of the three in ski production. Alpine thus gives up fewer skis
Attributed to Libby Rittenberg and Timothy Tregarthen
Saylor URL: />
Saylor.org
71
