The accompanying tables give production possibilities data for Gamma and Sigma. All data are in tons.Gamma's production possibilities ABCDETea1209060300Pots0306090120 Sigma's production possibilities ABCDETea403020100Pots0306090120 On the basis of this information,Question 3 options: Gamma should export both tea and pots to Sigma. Sigma should export tea to Gamma, and Gamma should export pots to Sigma. Gamma should export tea to Sigma, and Sigma should export pots to Gamma. Gamma should export tea to Sigma, but it will not be profitable for the two nations to exchange pots.

Who should export and who should import depend on comparative advantage. A country or an individual…

Answered: The accompanying tables give production…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The accompanying tables give production possibilities data for Gamma and Sigma. All data are in tons.

Gamma's production possibilities

	A	B	C	D	E
Tea	120	90	60	30	0
Pots	0	30	60	90	120

Sigma's production possibilities

	A	B	C	D	E
Tea	40	30	20	10	0
Pots	0	30	60	90	120

On the basis of this information,

Question 3 options:

	Gamma should export both tea and pots to Sigma.
	Sigma should export tea to Gamma, and Gamma should export pots to Sigma.
	Gamma should export tea to Sigma, and Sigma should export pots to Gamma.
	Gamma should export tea to Sigma, but it will not be profitable for the two nations to exchange pots.

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