The relative price of a unit of cloth in the small isolated country of Moribundia is 5 units of food. When the central city, Mudhole, puts in an airstrip, the country is able to engage in trade. If the relative price of cloth in the outside world is 3 units of food, then Moribundia will export ________ and ________ factors used in the production of ________ will benefit.
A) cloth; mobile; cloth
B) food; mobile; food
C) food; immobile; cloth
D) food; immobile; food
E) cloth; immobile; cloth
Correct Answer:
Verified
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