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Suppose that two economies, named Arcardia and Euphoria, can use their resources to produce good X, good Y, or a combination of both. The following
Suppose that two economies, named Arcardia and Euphoria, can use their resources to produce good X, good Y, or a combination of both. The following table shows the four different combinations of the two goods each country can produce. Combinations Arcardia Euphoria Good X Good Y Good X Good Y A 288 0 540 0 B 192 240 360 120 C 96 480 180 240 D 0 720 0 360 Arcardia has a comparative advantage in the production of good , and Euphoria has a comparative advantage in the production of good . Which of the following terms of trade would allow both Arcardia and Euphoria to gain from trade? Check all that apply. 1/4 unit of good X per unit of good Y 3/5 unit of good X per unit of good Y 5/3 units of good X per unit of good Y 5/4 units of good X per unit of good Y Initially, neither of the two economies is specializing in the production of one of the two goods, nor are the two economies trading with each other. In the no-specialization-no-trade (NS-NT) scenario, Arcardia produces and consumes 192 units of good X and 240 units of good Y
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