08. Given the above set of production possibilities and consumption (trade) possibilities frontiers, what happens to the prices of wine and/or cloth in each country as a result of trade? The price of wine increases from 1/3 in Portugal and decreases from 1 in England, to 2 yard/bottle in both The price of cloth increases from 3 in Portugal and decreases from 1 in England, to 2 bottles/yard in both The price of wine decreases from 1/3 in Portugal and increases from 1 in England, to % yard/bottle in both The price of cloth decreases from 3 in Portugal and increases from 1 in England, to 1 bottle/yard in both None of the above

08. Given the above set of production possibilities and consumption (trade) possibilities frontiers, what happens to the prices of wine and/or cloth in each country as a result of trade? The price of wine increases from 1/3 in Portugal and decreases from 1 in England, to 2 yard/bottle in both The price of cloth increases from 3 in Portugal and decreases from 1 in England, to 2 bottles/yard in both The price of wine decreases from 1/3 in Portugal and increases from 1 in England, to % yard/bottle in both The price of cloth decreases from 3 in Portugal and increases from 1 in England, to 1 bottle/yard in both None of the above

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter17: International Trade

Section: Chapter Questions

Problem 1.3P

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Similar questions

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