The following production possibilities schedule shows the quantities of wheat and rice that can be produced in Canada and India with one unit of equivalent resources.
TABLE 32-2
-Refer to Table 32-2.If Canada were to transfer one unit of resources from rice to wheat production and if one unit of Indian resources were switched from wheat to rice production,

Question

The following production possibilities schedule shows the quantities of wheat and rice that can be produced in Canada and India with one unit of equivalent resources.
  TABLE 32-2
-Refer to Table 32-2.If Canada were to transfer one unit of resources from rice to wheat production and if one unit of Indian resources were switched from wheat to rice production,

Quizplus · Accepted Answer

If Canada switches one unit of resources from rice to wheat production, it can produce 4 additional bushels of wheat as shown in the production possibility schedule. If India switches one unit of resources from wheat to rice production, it can produce 3 additional bushels of rice. Therefore, the total increase in wheat and rice production would be 4 and 3 bushels respectively, resulting in a net increase of 7 bushels. Thus, option A is the correct answer.

The Following Production Possibilities Schedule Shows the Quantities of Wheat