If resources and goods are free to move across states, if Oregon producers choose to specialize in producing honey and California producers choose to specialize in growing almonds, then we could reasonable conclude that:

Question

Quizplus · Accepted Answer

If resources and goods are free to move across states, producers will choose to specialize in the production of goods for which they have a comparative advantage, which is determined by identifying the goods with lower opportunity costs. In this scenario, California producers specialize in growing almonds because they have a lower opportunity cost of producing almonds than Oregon. Similarly, Oregon producers specialize in producing honey because they have a lower opportunity cost of producing honey than California. Therefore, all of the above are true, and the answer is E.

If Resources and Goods Are Free to Move Across States