Assume That Germany and China Can Produce Beer and Cloth

question 11

Multiple Choice

Assume that Germany and China can produce beer and cloth.If the
MPLc/MPLb for Germany is 2/5 and MPLc/MPLb for China is 1, then China
Should:

• A)specialize in producing beer and export beer.
• B)specialize in producing cloth and export cloth.
• C)not specialize, because China will not benefit from it.
• D)specialize in producing cloth and import cloth.

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