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In Samoa,the Opportunity Cost of Producing 1 Coconut Is 4

Question 28

Multiple Choice

In Samoa,the opportunity cost of producing 1 coconut is 4 pineapples,while in Guam,the opportunity cost of producing 1 coconut is 5 pineapples.What can we conclude in this situation?


A) If trade occurs, both countries will be able to consume beyond their original production possibilities frontiers.
B) Mutually beneficial trade cannot occur.
C) Guam will be better off if it exports coconuts and imports pineapples.
D) Both Samoa and Guam will be better off if Samoa produces both coconuts and pineapples.

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