-Use the above table. Assuming constant opportunity costs, if Argentina and France specialize based on comparative advantage, then they will trade if the rate of exchange
A)is 7 gallons of wine for 1 pound of beef, and Argentina imports beef.
B)0.25 gallons of wine for 1 pound of beef, and France imports beef.
C)0.25 pounds of beef for 1 gallon of wine, and Argentina imports wine.
D)0.4 pounds of beef for 1 gallon of wine, and France imports wine.

Question

-Use the above table. Assuming constant opportunity costs, if Argentina and France specialize based on comparative advantage, then they will trade if the rate of exchange
A)is 7 gallons of wine for 1 pound of beef, and Argentina imports beef. 
B)0.25 gallons of wine for 1 pound of beef, and France imports beef. 
C)0.25 pounds of beef for 1 gallon of wine, and Argentina imports wine. 
D)0.4 pounds of beef for 1 gallon of wine, and France imports wine.

Quizplus · Accepted Answer

The Answer of 
-Use the above table. Assuming constant opportunity costs, if Argentina and France specialize based on comparative advantage, then they will trade if the rate of exchange
A)is 7 gallons of wine for 1 pound of beef, and Argentina imports beef. 
B)0.25 gallons of wine for 1 pound of beef, and France imports beef. 
C)0.25 pounds of beef for 1 gallon of wine, and Argentina imports wine. 
D)0.4 pounds of beef for 1 gallon of wine, and France imports wine.

-Use the Above Table