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cacerami cacerami
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A year ago
Scenario: Consider two economies, Beta and Zeta. Each farmer in Beta can grow 1,000 pounds of apples or 500 pounds of oranges in a year. Each farmer in Zeta can grow 400 pounds of apples or 1,200 pounds of oranges in a year.


Refer to the scenario above. Which of the following statements is TRUE in this case?

▸ Zeta should specialize in producing oranges, and Beta should specialize in producing apples.

▸ Beta and Zeta will suffer losses if they engage in foreign trade.

▸ Zeta has an absolute advantage in producing both oranges and apples.

▸ Beta has a comparative advantage in producing both oranges and apples.
Textbook 
Macroeconomics

Macroeconomics


Edition: 3rd
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CodybarnesCodybarnes
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