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Australia and Germany are considering an agreement that would enable a trade to occur. This agreement would enable a wide range of goods to

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Australia and Germany are considering an agreement that would enable a trade to occur. This agreement would enable a wide range of goods to be traded if this was possible. Currently, the two items being considered are pharmaceuticals and apples. Based on current output and prices, Germany can produce 5 units of pharmaceuticals, whereas Australia can produce 3 units of pharmaceuticals. For apples, Germany can produce 5 units, and Australia can produce 4 units. Required: Explain whether trade can occur between the two countries and if it can occur, how it will happen.

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