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Given the Following Diagram Showing a Fixed-Quantity Production-Possibilities Frontier, a Community

Question 4

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Given the following diagram showing a fixed-quantity production-possibilities frontier, a Community indifference curve, and the associated autarky price line, if this country is Opened to trade through exposure to different relative prices, the country can attain
Given the following diagram showing a fixed-quantity production-possibilities frontier, a Community indifference curve, and the associated autarky price line, if this country is Opened to trade through exposure to different relative prices, the country can attain   A)  both a  production gain  ( gains from specialization )  and a  consumption gain  ( gains from exchange ) . B)  neither a  production gain  ( gains from specialization )  nor a  consumption gain  ( gains from exchange ) . C)  a  consumption gain  ( gains from exchange )  but not a  production gain  ( gains From specialization ) . D)  a  production gain  ( gains from specialization )  but not a  consumption gain  ( gains from exchange ) .


A) both a "production gain" ("gains from specialization") and a "consumption gain" ("gains from exchange") .
B) neither a "production gain" ("gains from specialization") nor a "consumption gain" ("gains from exchange") .
C) a "consumption gain" ("gains from exchange") but not a "production gain" ("gains From specialization") .
D) a "production gain" ("gains from specialization") but not a "consumption gain" ("gains from exchange") .

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