Assume that two countries (Home and Foreign) each produce two goods (corn and wheat) under constant cost production. Home produces 0.5 ton of corn or 1 ton of wheat with a day of labor. Without trade (in autarky), Home's daily production is 20 tons of wheat and 10 tons of corn. Suppose that, after trade occurs, the international price actually becomes 1.5 tons of wheat per ton of corn.

Which statement is true?

1. Both Home and Foreign will gain from trade.
2. Neither Home nor Foreign will gain from trade.
3. Home will gain from trade but Foreign will not.
4. Foreign will gain from trade but Home will not.