Table 1 shows the units of output a worker can produce per month in South Africa and Namibia.
$$\begin{array} { | l | c | c | }
\hline & \text { Fond } & \text { Electranics } \
\hline \text { South Africa } & 20 & 5 \
\hline \text { Narmibia } & 8 & 2 \
\hline
\end{array}$$
-Refer to Table 1. Prices of electronics can be stated in terms of units of food. What is the range of prices of electronics for which both countries could gain from trade? The price must be greater than:

Question

Table 1 shows the units of output a worker can produce per month in South Africa and Namibia.
 $$\begin{array} { | l | c | c | } 
\hline & \text { Fond } & \text { Electranics } \
\hline \text { South Africa } & 20 & 5 \
\hline \text { Narmibia } & 8 & 2 \
\hline
\end{array}$$
-Refer to Table 1. Prices of electronics can be stated in terms of units of food. What is the range of prices of electronics for which both countries could gain from trade? The price must be greater than:

Quizplus · Accepted Answer

South Africa's opportunity cost of 1 electronic is 4 units of food (20/5), and Namibia's is 4 units of food (8/2). For both to gain, the price must be greater than 2 units of food (Namibia's opportunity cost) but less than 4 units of food (South Africa's opportunity cost).

Table 1 Shows the Units of Output a Worker Can