If the USA could produce 1 ton of potatoes or 0.5 tons of wheat per worker per year, while Ireland could produce 3 tons of potatoes or 2 tons of wheat per worker per year, there can be mutual gains from trade if:
A) The USA specializes in potatoes because of its comparative advantage in producing potatoes.
B) The USA specializes in wheat because of its absolute advantage in producing wheat.
C) The USA specializes in wheat because of its comparative advantage in producing wheat.
D) There can be no mutual gains from trade.
Correct Answer:
Verified
Q8: Suppose that Canada can produce 100,000 hockey
Q9: Alpha can produce either 18 oranges or
Q10: Which of the following is true?
A) A
Q11: The slope of the production possibility frontier
Q12: When one nation can produce a product
Q14: Jethro has a(n) _ in all aspects
Q15: When nations increase production in their area
Q16: Alternate Outputs from One Day's Labor Input:
USA:
Q17: The theory of comparative advantage shows that
Q18: The slope of the production possibility frontier
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents