You are the Minister of Trade for a small island country with the following annual PPC. You are negotiating a trade agreement with a neighboring island with the following annual PPC. If you offer to give the other island 1 coconut for every 4 fish they gi
You are the Minister of Trade for a small island country with the following annual PPC. You are negotiating a trade agreement with a neighboring island with the following annual PPC. If you offer to give the other island 1 coconut for every 4 fish they give you, then they will:
A.refuse your offer because they have a comparative advantage in fish.
B.accept your offer because your opportunity cost of a coconuts is less than 4 fish.
C.accept your offer because their opportunity cost of a coconut is greater than 4 fish.
D.refuse your offer because they can produce as many coconuts as you can.
正确答案:accept your offer because their opportunity cost of a coconut is greater than 4 fish.
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