There are two countries: Country X and Country Y. These countries have the same amount of resources and both produce two goods, umbrellas and hats. The opportunity cost of umbrellas in Country X is hats per umbrella and the opportunity cost of umbrellas in Country Y is 4 hats per umbrella. Each country will produce and trade the good in which they have a comparative advantage.

Would both of these countries accepts a trade of 5 hats per umbrella?

• No. Country Y will reject this trade
• No. Country X will reject this trade
• Yes. Both countries will accept this trade.
• No.Both of these countries will reject this trade.