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Country X can produce 1,000 units of food and 2,000 units of clothes. Country Y can produce 1,000 units of food and 1,000 units of clothes. In order to maximize trade according to the principles of comparative advantage

A) country X should produce food and import clothes from country Y.
B) country Y should produce food and import clothes from country X.
C) country X and Y should produce both food and clothes to meet their own needs.
D) country Y should produce both food and clothes, and import additional clothes from country X.

1 Answer

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b. country Y should produce food and import clothes from country X.

User Christurnerio
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