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Suppose There Are Three Nations (North,South,and East) and Three Goods

Question 1

Multiple Choice

Suppose there are three nations (North,South,and East) and three goods (A,B,and C) . Given resources and technology,North can produce 5 units of A,or 2 units of B,
Or 10 units of C,or any linear combination thereof. South can produce 5 units of A,
Or 2 units of B,or 5 units of C,or any linear combination thereof. East can produce
Either 1 unit of A,or 5 units of B,or 10 units of C,or any linear combination thereof.
The most efficient pattern of specialization is to have


A) North produce A, South produce B, and East produce C
B) North produce A, South produce C, and East produce B
C) South produce A, North produce B, and East produce C
D) South produce A, North produce C, and East produce B
E) East produce A, South produce B, and North produce C

Correct Answer:

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