Figure 17-8 Refer to Figure 17-8. With trade, this country

Question

Figure 17-8  Refer to Figure 17-8. With trade, this country

Quizplus · Accepted Answer

The country is producing at point A, which is below its production possibility frontier (PPF) of 60 wagons. With trade, it can consume at point C, which is on its PPF, where it can produce and consume 60 wagons. Therefore, the difference between the 60 wagons it can produce and consume without trade and the 30 wagons it produces and consumes with trade (point C) is the amount it imports, which is 30 wagons. Thus, the answer is D.