Alpha can produce either 18 tons of oranges or 9 tons of apples in a year, while Omega can produce either 16 tons of oranges or 4 tons of apples. If the terms of trade are established as 1 ton of apples for 4 tons of oranges:
a. there are no incentives
for Omega to engage in international specialization and trade with Alpha.
b. it is in the interest of Omega to grow oranges and trade for apples.
c. it is in the interest of both countries to specialize and trade with one another.
d. there are no incentives for Alpha or Omega to specialize and trade with one another.
Answer: a
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