Multiple Choice
Autos and chemicals are in units of one million
Refer to the above tables.If Germany and the United States engage in trade,the terms of trade will be between:
A) 3 and 4 units of autos for 1 unit of chemicals.
B) 2 and 4 units of autos for 1 unit of chemicals.
C) 2 and 4 units of chemicals for 1 unit of autos.
D) .33 and .5 unit of autos for 1 unit of chemicals.
In Germany,1 auto = 2 chemicals and in the United States,1 auto = 4 chemicals.Therefore,the terms of trade will be 1 auto = (between) 2 to 4 chemicals.
Correct Answer:
Verified
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