Answer the Next Question on the Basis of the Following

question 72

Multiple Choice

Answer the next question on the basis of the following production possibilities data for two countries,Alpha and Beta,which have populations of equal size. Suppose that before specialization and trade Alpha chose production alternative C and Beta chose production alternative B.After specialization and trade the gains will be:

• A) 20 tons of fish.
• B) 20 tons of chips.
• C) 20 tons of fish and 20 tons of chips.
• D) 240 tons of fish and 20 tons of chips. Before specialization,total output of fish was 220 (40 + 180)and total output of chips was 20 (10 + 10).After specialization,Beta will produce only fish (240 tons)and Alpha will produce only chips (20 tons).This is a net gain of 20 tons of fish and no change in the amount of chips.