Suppose country Alpha must give up 2 units of clothing for each unit of food produced, while country Omega must give up 1/2 of a unit of clothing for each unit of food produced. If specialization and trade were to occur between these two fictitious countries, which of the following would be consistent with comparative advantage and mutually advantageous trade?
a. Omega will sell food to Alpha at a price of 1 unit of clothing for 1/2 unit of food.
b. Omega will sell food to Alpha at a price of 1 unit of clothing for each unit of food.
c. Alpha will sell food to Omega at a price of 2 units of clothing for each unit of food.
d. Alpha will sell food to Omega at a price of 1 unit of clothing for each unit of food.
b
Economics
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