Suppose That Two Countries Each Have the Exact Convex-To-The-Origin Production-Possibilities

question 18

Multiple Choice

Suppose that two countries each have the exact convex-to-the-origin production-Possibilities frontier (PPF) as in Question #17 above (i.e., the countries have identical PPFs like the Question #17 PPF) and the two countries also have identical tastes. In this situation,

• A) neither of the two countries could never gain from trade with each other.
• B) one country could gain from trade with the other but they could never both gain from The trade.
• C) both countries would go to the same endpoint of the PPF if the two countries engaged In trade with each other.
• D) it is possible for the two countries to gain from trade with each other if one country Produces at one endpoint of the PPF and the other country produces at the other Endpoint of the PPF

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