Almia And Adjikistan Are Two Open Economies Producing Goods A And B Many People In​ Almia Including The


Almia and Adjikistan are two open economies producing goods A and B. Many people in​ Almia, including the

leading​ economists, are lobbying for trade. They feel that the country has a comparative advantage in good A that could be traded with good B from Adjikistan. The government of Adjikistan is also under pressure from various groups to encourage trade with Almia.​ However, when both countries begin to​ trade, gains from exporting good A to Adjikistan turn out to be much lower than what​ Almia’s economists had anticipated.

Which of the​ following, if​ true, would explain this​ outcome?

A. With the introduction of​ trade, Adjikistan now has access to​ Almia’s advanced production technology in A.

B. Industries in Almia have better environmental standards than Adjikistan.

C. The Almian workers are more efficient in producing good A than good B.

D. The opportunity cost of producing good A in Almia is very low.

E. Almia has a very large workforce.