Figure 3-3 Ice Cream and Cones Are Measured in Kilograms

question 44

Multiple Choice

Figure 3-3
Ice cream and cones are measured in kilograms.
-Refer to Figure 3-3. Suppose Ben and Jerry were both producing at point A on their production possibilities frontier and then Ben decided he would be willing to trade 4 kg of cones to get 2 kg of ice cream from Jerry. If both decided to specialize in what they had a comparative advantage in and trade, what would be the gains from trade?

• A) 1 kg of cones for Ben and 1 kg of ice cream for Jerry
• B) 1 kg of ice cream for Ben and 1 kg of cones for Jerry
• C) 2 kg of ice cream for Ben and 2 kg of cones for Jerry
• D) 2 kg of ice cream for Ben and 1 kg of cones for Jerry

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Definitions:

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The practice of contacting individuals by phone to promote services or products, often unsolicited.

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A check that is void after a certain time limit; commonly used for payroll.

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A special bank check that allows a depositor to draw funds from his own account only, as when he has forgotten his checkbook.