Use the Following to Answer Question

question 96

Multiple Choice

Use the following to answer question :
-(Table: Fish and Coconut Production Possibilities) The table shows the maximum amount of fish and coconuts that Tom and Hank can produce if they produce only one good. Tom produces and consumes nine fish and two coconuts, and Hank produces and consumes three fish and two coconuts. Now they decide to engage in trade. Which of the following statements is INCORRECT?

• A)For both to become better off, each should specialize in the production of some good. However, since Hank is equally productive in both goods, it doesn't matter which good each specializes in.
• B)For both to become better off, each should specialize completely in the production of the good in which he has a comparative advantage.
• C)After trade it is possible for Tom to consume 9 fish and 2.5 coconuts and for Hank to consume 3 fish and 2.5 coconuts.
• D)For each individual, the consumption point after trade will lie outside that individual's production possibility frontier.