Refer to the figure above. In free trade A will import
A) 700 units from country C.
B) 700 units from C and 600 units from B.
C) 600 units from C.
D) 600 units from C and 400 units from B.
Question 2
If points A and B are two locations on a country's production possibility frontier, then
A) the country could produce either of the two bundles.
B) consumers are indifferent between the two bundles.
C) producers are indifferent between the two bundles.
D) at any point in time, the country could produce both.
E) both bundles must have the same relative cost.
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