Consider a two-country, two-commodity model. The table below shows the units of Good X and Good Y produced in Country A and Country B per labor hour. If Country B transfers one labor hour from the production of Good X to the production of Good Y, total world production of Good Y will ________ by ________ unit(s). ProductivityCountry ACountry BGood X1.000.50Good Y0.200.70
A. increase; 0.7
B. increase; 0.5
C. decrease; 1.5
D. decrease; one
Answer: A
Economics
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