Figure 3-5 The graph below represents the various combinations of cars and corn that Country A could produce in a given month. (On the vertical axis, corn is measured in bushels.)

-Refer to Figure 3-5.Under which of the following circumstances would Country A be able to consume outside of its production possibilities frontier?
A)Under no circumstances is that possible.
B)Country A trades with Country B; Country A has a comparative advantage over Country B in producing corn; and Country A specializes in car production.
C)Country A trades with Country B; Country A has a comparative advantage over Country B in producing cars; and Country A specializes in car production.
D)Country A trades with Country B; Country A has an absolute advantage over Country B in producing cars; and Country A specializes in car production.

Question

Figure 3-5 The graph below represents the various combinations of cars and corn that Country A could produce in a given month. (On the vertical axis, corn is measured in bushels.)
 
-Refer to Figure 3-5.Under which of the following circumstances would Country A be able to consume outside of its production possibilities frontier?
A)Under no circumstances is that possible. 
B)Country A trades with Country B; Country A has a comparative advantage over Country B in producing corn; and Country A specializes in car production. 
C)Country A trades with Country B; Country A has a comparative advantage over Country B in producing cars; and Country A specializes in car production. 
D)Country A trades with Country B; Country A has an absolute advantage over Country B in producing cars; and Country A specializes in car production.

Quizplus · Accepted Answer

Country A can consume outside its production possibilities frontier if it trades with Country B and specializes in producing the good for which it has a comparative advantage, allowing it to trade for other goods.

Figure 3-5 the Graph Below Represents the Various Combinations of Cars