答案如下

The following chart indicates the production possibilities of food and drink per day in Country A and Country B.
Which of the following statements is TRUE?

A) Since B workers can produce more of food and drink than A workers, no gains from trade are possible.
B) A is the low-cost producer of both food and drink.
C) Mutual gains could be realized from trade if A specialized in food production and B specialized in drink production.
D) Mutual gains could be realized from trade if A specialized in drink production and B specialized in the food production

answer
The correct answer was D) Mutual gains could be realized from trade if A specialized in drink production and B specialized in the food production.
Mutual gains could be realized from trade if A specialized in drink production and B specialized in food production. The reason centers on comparative advantage. Country A must give up 1.5 units of drink to produce one unit of food. Country B must give up 7/8th unit of drink to produce one unit of food. Therefore, the opportunity cost of producing food is greater for A than for B. If B produces 8 units of food and A produces 6 units of drink, each country can have 4 units of food and 3 units of drink and they will both benefit compared to other possible combinations of production.

d