People in the U.S. state of Iowa eat both corn and potatoes. It is technically possible for farmers to grow both corn and potatoes in Iowa, yet almost no farmers grow potatoes. Instead, every year, Iowa exports corn and imports potatoes from the U.S. state of Idaho, where farmers specialize in potatoes. Which of the following principles of economic interaction best describes this scenario? Trade can make everyone better off. All costs are opportunity costs. When markets do not achieve efficiency, government intervention can improve overall welfare. There is a tradeoff between equality and efficiency.
People in the U.S. state of Iowa eat both corn and potatoes. It is technically possible for farmers to grow both corn and potatoes in Iowa, yet almost no farmers grow potatoes. Instead, every year, Iowa exports corn and imports potatoes from the U.S. state of Idaho, where farmers specialize in potatoes. Which of the following principles of economic interaction best describes this scenario? Trade can make everyone better off. All costs are opportunity costs. When markets do not achieve efficiency, government intervention can improve overall welfare. There is a tradeoff between equality and efficiency.
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter19: International Trade
Section: Chapter Questions
Problem 3QFR
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People in the U.S. state of Iowa eat both corn and potatoes. It is technically possible for farmers to grow both corn and potatoes in Iowa, yet almost no farmers grow potatoes. Instead, every year, Iowa exports corn and imports potatoes from the U.S. state of Idaho, where farmers specialize in potatoes.
Which of the following principles of economic interaction best describes this scenario?
Trade can make everyone better off.
All costs are opportunity costs.
When markets do not achieve efficiency, government intervention can improve overall welfare.
There is a tradeoff between equality and efficiency.
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