Exhibit 17-1
-Exhibit 17-1 shows the production possibilities frontiers for the countries of Lambda and Beta for fish and coconuts.If the terms of trade are 1 $1 / 2$ fish per coconut,then Lambda and Beta would be able to benefit from specialization and trade.

Question

Exhibit 17-1 
-Exhibit 17-1 shows the production possibilities frontiers for the countries of Lambda and Beta for fish and coconuts.If the terms of trade are 1 $1 / 2$ fish per coconut,then Lambda and Beta would be able to benefit from specialization and trade.

Quizplus · Accepted Answer

If the terms of trade are 1.5 fish per coconut, both countries can specialize in producing the good for which they have a comparative advantage and trade to obtain the other good at a lower opportunity cost than producing it themselves.

Exhibit 17-1 -Exhibit 17-1 Shows the Production Possibilities Frontiers 1/21 / 21/2

Exhibit 17-1
-Exhibit 17-1 Shows the Production Possibilities Frontiers $1 / 2$