Question

People in the U.S. state of Iowa eat both corn and potatoes. It is technically possible for farmers to grow both corn and potatoes in Iowa, yet almost no farmers grow potatoes. Instead, every year, Iowa exports corn and imports potatoes from the U.S. state of Idaho, where farmers specialize in potatoes.

Answer 1

The principles of economic interaction best describes this scenario is Trade can make everyone better off.

Step-by-step explanation:

Trade Could Best Serve Anyone. A person claims that their family needs to compete in jobs with many other families and that when we buy, we compete with other people to find the best prices. But when we harvest our own vegetables, make our own clothing and build our own homes, we would have to create our own.

"Trade helps every person to specialize in what he or she does best, whether it is agriculture, sewing or home building." In both cases, consumers can choose from a wider range at lower prices.

It is plain that there are too many people to be able to exist on this planet without the commerce of which Mankiw talks. The huge number of small farms that we would have to establish, even if we wanted, do not have arable land enough to support, and I don't believe that is what people want. And Mankiw's way of explaining it seems all so normal, perhaps because we learned it all our lives.