Comparative advantage and Opportunity Cost(cont A country faces opportunity costs when it employs resources to produce goods and services For example, a limited number of workers could be employed to produce either wine or cheese The opportunity cost of producing wine is the amount of cheese not produced The opportunity cost of producing cheese is the amount of wine not produced a country faces a trade off: how much wine or cheese should it produce with the limited resources that it has?6 Comparative Advantage and Opportunity Cost (cont.) • A country faces opportunity costs when it employs resources to produce goods and services. • For example, a limited number of workers could be employed to produce either wine or cheese. – The opportunity cost of producing wine is the amount of cheese not produced. – The opportunity cost of producing cheese is the amount of wine not produced. – A country faces a trade off: how much wine or cheese should it produce with the limited resources that it has?