The table below shows the quantity demanded (in thousands) and quantity supplied (in thousands) of computers in the U.S. and Canada at different prices.Table 20.5

-Any terms of trade within the limits set by domestic opportunity costs will be mutually harmful, because each country tries to push the other as close to the limits of the terms of trade as possible.

Question

The table below shows the quantity demanded (in thousands) and quantity supplied (in thousands) of computers in the U.S. and Canada at different prices.Table 20.5
 
-Any terms of trade within the limits set by domestic opportunity costs will be mutually harmful, because each country tries to push the other as close to the limits of the terms of trade as possible.

Quizplus · Accepted Answer

The statement is incorrect. Terms of trade within the limits of domestic opportunity costs can be mutually beneficial for both countries, as they allow for specialization and trade based on comparative advantage.

The Table Below Shows the Quantity Demanded (In Thousands) and Quantity