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.
Correct Answer:
Verified
Q23: Table 14-2
Alpha can produce either 18 oranges
Q24: Table 14-2
Alpha can produce either 18 oranges
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Q26: If Samoa could produce either 3 coconuts
Q27: Table 14-1
Alternate Outputs from One Day's Labour
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Q30: The opportunity cost of producing a pair
Q31: Table 14-1
Alternate Outputs from One Day's Labour
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Q33: Table 14-2
Alpha can produce either 18 oranges
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