Answer the question(s)below based on the following diagram of a country that is in international trade equilibrium.

-Refer to the figure above.Which of the following is true?
A)This country is completely specialized in the production of X.
B)This country consumes at point F.
C)The value of this country's consumption equals the value of its production.
D)None of the above.

Question

Answer the question(s)below based on the following diagram of a country that is in international trade equilibrium.
 
-Refer to the figure above.Which of the following is true?
A)This country is completely specialized in the production of X. 
B)This country consumes at point F. 
C)The value of this country's consumption equals the value of its production. 
D)None of the above.

Quizplus · Accepted Answer

According to the diagram, the country is at international trade equilibrium, meaning that its imports and exports are balanced. This implies that the value of the country's consumption is equal to the value of its production. Option A is not necessarily true since it is not clear from the diagram whether the country has any comparative advantage or not. Option B is also not necessarily true since the diagram does not show the exact point at which the country is consuming.

Answer the Question(s)below Based on the Following Diagram of a Country