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Suppose a country produces two types of goods (agricultural goods and manufactured goods), and workers within the country differ in their abilities. If the terms
Suppose a country produces two types of goods (agricultural goods and manufactured goods), and workers within the country differ in their abilities. If the terms of trade change so that 1 unit of manufactured goods trades in world markets for more agricultural goods than before, how will this change the combination of the two goods the country wants to produce?
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