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The Two-Country General Equilibrium (PPF/indifference Curves) Model Shows That When

Question 15

Multiple Choice

The two-country general equilibrium (PPF/indifference curves) model shows that when two countries open their economies and trade freely:


A) both countries reach higher indifference curves.
B) consumers in both countries enjoy combinations of products that are simply not attainable without trade.
C) both countries specialize in producing the products in which each enjoys a comparative advantage.
D) All of the above.
E) None of the above.

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