Two countries, A and B, that differ in their opportunity costs for the goods each one of them produces have decided to engage in trade. There is A. a unique trading ratio of these two goods that will benefit both countries. B. a unique trading ratio at which Country A will have gains from trade, but Country B will not. C. a range of trading ratios that lies between the opportunity costs of each good for both countries at which both countries will benefit from trade. D. a unique trading ratio at which Country B will have gains from trade, but Country A will not. E. a range of trading ratios that provides gains from trade only to Country A.

The countries get involved in trade with each other as it opens up wider markets for both the…

Answered: Two countries, A and B, that differ in…

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter19: International Trade

Section: Chapter Questions

Problem 12PAE

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	A. a unique trading ratio of these two goods that will benefit both countries.
	B. a unique trading ratio at which Country A will have gains from trade, but Country B will not.
	C. a range of trading ratios that lies between the opportunity costs of each good for both countries at which both countries will benefit from trade.
	D. a unique trading ratio at which Country B will have gains from trade, but Country A will not.
	E. a range of trading ratios that provides gains from trade only to Country A.