Suppose that Portugal and Sweden both produce jeans and cheese. Portugal's opportunity cost of producing a pound of cheese is 5 pairs of jeans while Sweden's opportunity cost of producing a pound of cheese is 10 pairs of jeans.

By comparing the opportunity cost of producing cheese in the two countries, you can tell thatA. Sweden or B. Portugalhas a comparative advantage in the production of cheese and A. Portugal or B. Sweden has a comparative advantage in the production of jeans.

Suppose that Portugal and Sweden consider trading cheese and jeans with each other. Portugal can gain from specialization and trade as long as it receives more than A. 1 pair, B. 1/10 pair, C. 1/5 pair, D. 5 pairs or E. 10 pairsof jeans for each pound of cheese it exports to Sweden. Similarly, Sweden can gain from trade as long as it receives more than A. 1 pound, B. 1/10 pound, C. 1/5 pound, D. 5 pounds, or E. 10 pounds of cheese for each pair of jeans it exports to Portugal.

Based on your answer to the last question, which of the following prices of trade (that is, price of cheese in terms of jeans) would allow both Sweden and Portugal to gain from trade?Check all that apply.

___3 pairs of jeans per pound of cheese

___8 pairs of jeans per pound of cheese

___1 pair of jeans per pound of cheese

___9 pairs of jeans per pound of cheese