The Following Table Indicates the Production Possibilities of Cars and Clothing

question 193

Multiple Choice

The following table indicates the production possibilities of cars and clothing per worker day in the United States and Japan.

Which of the following is true?

• A)No gains from trade are possible.
• B)Joint output would be maximized if the United States specialized in producing cars and Japan in producing clothing.
• C)Mutual gains from trade could be realized if the United States specialized in clothing production and Japan in car production.
• D)The Japanese are the high-cost producers of both cars and clothing.

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