Suppose that the opportunity-cost ratio for watches and cheese is 1C ≡ 1W in Switzerland but 1C ≡ 4W in Japan. At which of the following international exchange ratios (terms of trade) will Switzerland and Japan be willing to specialize and engage in trade with each other? Select one or more answers from the choices shown. a. 1C ≡ 3W. b. 1C ≡ 1 2W. c. 1C ≡ 5W. d. 1 2 C ≡ 1W. e. 2C ≡ 1W.

Suppose that the opportunity-cost ratio for watches and cheese is 1C ≡ 1W in Switzerland but 1C ≡ 4W in Japan. At which of the following international exchange ratios (terms of trade) will Switzerland and Japan be willing to specialize and engage in trade with each other? Select one or more answers from the choices shown. a. 1C ≡ 3W. b. 1C ≡ 1 2W. c. 1C ≡ 5W. d. 1 2 C ≡ 1W. e. 2C ≡ 1W.

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter20: International Trade

Section20.1: International Trade Theory

Problem 1ST

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