Monesia produces about 60 percent of the world's palm oil. Palm oil is used in the production of shampoo, ice cream, and chocolate. Assume that Switzerland does not produce palm oil but
mpanies in Switzerland import palm oil from Indonesia to make chocolate.
Durce: Jon Emont, "Soaring Demand for Palm Oil Puts Rainforests at Risk Again," Wall Street Journal, May 7, 2022.
ompared to Switzerland, does Indonesia have an absolute advantage in the production of palm oil?
A. No, both countries can make equal amounts of palm oil if they choose to do so.
B. Yes, Indonesia has an absolute advantage because Switzerland does not make palm oil.
OC. Yes, Indonesia has an absolute advantage because it makes more palm oil than Switzerland does.
D. It is difficult to determine since we don't know the abilities of Indonesia and Switzerland to produce palm oil.