Use the Figure Below to Answer the Following Questions

question 81

Multiple Choice

Use the figure below to answer the following questions.
Table 2.3.1
The planets of Vulcan and Romulus each produce goods X and Y.
The following table gives points on their production possibilities frontiers.
-Refer to Table 2.3.1.Each country gains from trade if

• A)they both produce the goods in which they have an absolute advantage.
• B)Vulcan specializes in good X and Romulus specializes in good Y.
• C)Vulcan specializes in both goods.
• D)Romulus specializes in both goods.
• E)Romulus specializes in good X and Vulcan specializes in good Y.

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Definitions:

Aggregate Income

The total income earned by all individuals or entities in an economy, including wages, profits, rents, and investment earnings, over a specific time period.

Aggregate Consumption

The total amount of goods and services consumed in an economy over a specific period.

Consumption Function

A relationship in economic terms between the gross national income and the aggregate consumption level.

Aggregate Income

The total income earned by all factors of production in an economy, including wages, rents, interest, and profits, over a specific period.