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In the world of Fall, two countries Starbuckia and Soergel Land can both produce Pumpkin Lattes and Apple Cider Doughnuts. Pumpkin Lattes Apple Cider Doughnuts
In the world of Fall, two countries Starbuckia and Soergel Land can both produce Pumpkin Lattes and Apple Cider Doughnuts.
Pumpkin Lattes | Apple Cider Doughnuts | |
Starbuckia | 13 | 39 |
Soergel Land | 6 | 24 |
- Draw the production possibility frontier for each country.
- What is the opportunity cost for each country to produce pumpkin lattes?
- In this case, can there be gains from trade? If so, why? Be sure to be specific.
- If there can be gains from trade show me a numerical example of how that might work. (In other words, show me how they gain or why not)
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