Refer to the information provided in Table 18.6 below to answer the questions that follow.
Table 18.6
-Refer to Table 18.6. If the exchange rate is $1 = 2 euros, then

Question

Refer to the information provided in Table 18.6 below to answer the questions that follow.
Table 18.6 
-Refer to Table 18.6. If the exchange rate is $1 = 2 euros, then

Quizplus · Accepted Answer

Looking at the table, we can see that the opportunity cost of producing peas in the United States is 2 carrots, while in France it is only 1 carrot. This means that France has a comparative advantage in producing peas, while the United States has a comparative advantage in producing carrots. Therefore, if the exchange rate is $1 = 2 euros, it would be cheaper for the United States to import peas from France, and for France to import carrots from the United States. Thus, the United States will import peas and France will import carrots.

Refer to the Information Provided in Table 18