$$~~~{ \text { United States } } ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ { \text { China } } \
\begin{array} { c c c c c }
\text { Possibility } & \text { Radios } & \text { Rice } & \text { Radios } & \text { Rice } \
\text { A } & 200 & 0 & 300 & 0 \
\text { B } & 100 & 500 & 150 & 300 \
\text { C } & 0 & 1,000 & 0 & 600
\end{array}$$
-In the absence of trade between the two countries,the price of rice in the U.S.in terms of radios would tend to be

Question

$$~~~{ \text { United States } } ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ { \text { China } } \
\begin{array} { c c c c c } 
\text { Possibility } & \text { Radios } & \text { Rice } & \text { Radios } & \text { Rice } \
\text { A } & 200 & 0 & 300 & 0 \
\text { B } & 100 & 500 & 150 & 300 \
\text { C } & 0 & 1,000 & 0 & 600
\end{array}$$
-In the absence of trade between the two countries,the price of rice in the U.S.in terms of radios would tend to be

Quizplus · Accepted Answer

In the absence of trade, the opportunity cost of producing one radio in the United States is 5 units of rice (from possibility B, where 100 radios equate to 500 units of rice, thus 1 radio = 500/100 = 5 units of rice). Therefore, the price of rice in terms of radios in the U.S. would be the inverse, 1/5.

-In the Absence of Trade Between the Two Countries,the Price