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Suppose that before trade takes place the United States is at a point on its PPC where it produces 20 loaves of bread and 20 units of steel Once trade becomes possible, the price of a unit of steel

Suppose that before trade takes place, the United States is at a point on its PPC where it produces 20 loaves of bread and 20 units of steel. Once trade becomes possible, the price of a unit of steel is 2 units of bread. In response, the United States moves along its PPC to a new point where it is producing 30 units of steel and 10 loaves of bread. Is the country better off? How do you know?

Apr 02 2020 View more View Less

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