Answer the question on the basis of the accompanying production possibilities tables for two countries, Latalia and Trombonia. Latalia's production possibilities A B D E Pork (Tons) Beans (Tons) 4 3 2 1 10 15 Trombonia's production possibilities A E Pork (Tons) Beans (Tons) 8 6. 4 2 6. 12 18 24 Assume that before specialization and trade, Latalia produced combination C and Trombonia produced combination B. If these two nations now specialize completely based on comparative advantage, the total gains from specialization and trade will be A) 4 tons of pork. C) 4 tons of beans. B) 2 tons of pork and 4 tons of beans. D) 1 ton of pork and 2 tons of beans. 20
Answer the question on the basis of the accompanying production possibilities tables for two countries, Latalia and Trombonia. Latalia's production possibilities A B D E Pork (Tons) Beans (Tons) 4 3 2 1 10 15 Trombonia's production possibilities A E Pork (Tons) Beans (Tons) 8 6. 4 2 6. 12 18 24 Assume that before specialization and trade, Latalia produced combination C and Trombonia produced combination B. If these two nations now specialize completely based on comparative advantage, the total gains from specialization and trade will be A) 4 tons of pork. C) 4 tons of beans. B) 2 tons of pork and 4 tons of beans. D) 1 ton of pork and 2 tons of beans. 20
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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I'm confused on how to calculate the gains from trade. I don't know what to do.
Transcribed Image Text:Answer the question on the basis of the accompanying production possibilities tables
for two countries, Latalia and Trombonia.
Latalia's production possibilities
A
C
D
Pork (Tons)
Beans (Tons)
4
3
2
1
5
10
15
20
Trombonia's production possibilities
A
C
D
E
Pork (Tons)
Beans (Tons)
8
6.
4
2
6
12
18
24
Assume that before specialization and trade, Latalia produced combination C and
Trombonia produced combination B. If these two nations now specialize completely
based on comparative advantage, the total gains from specialization and trade will be
A) 4 tons of pork.
C) 4 tons of beans.
B) 2 tons of pork and 4 tons of beans.
D) 1 ton of pork and 2 tons of beans.
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