Answer the following question on the basis of the data given for two regions, East and West, of a hypothetical world. The nations have the production possibilities for units of food and clothing given below.
Refer to the data above. The mutually beneficial terms of trade will be:
A. Greater than 4 units of food for 1 unit of clothing
B. Between 4 and 5 units of food for 1 unit of clothing
C. Between 2 and 3 units of food for 1 unit of clothing
D. Less than 2 units of food for 1 unit of clothing
C. Between 2 and 3 units of food for 1 unit of clothing
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Equilibrium in a market is
a. a situation in which there are no inherent forces that produce change. b. the natural state of affairs in the market. c. the actual price and quantity that will exist in a market. d. the best price and quantity that can exist in a market. e. All of the above are correct.
Exhibit 4-7 Demand and supply schedules for movie tickets Price QuantityDemanded QuantitySupplied $10 200 500 8 240 470 6 370 420 4 390 390 2 410 310 In Exhibit 4-7, a 100 unit decrease in quantity demanded at every price level would cause the new equilibrium price to become:
A. $8. B. $6. C. $4. D. $2.