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Commerce · Q657

Business Environment and International Business

Graduate and Post Graduate · Commerce · question 657

Q657

The following table shows cost per unit of production of two goods, wheat and cloth in 2 countries X and Y with no transportation cost and free trade X (Rs.) Y (Rs.) Wheat 50 350 Cloth 100 500 Which one of the following will take place?

The following table shows cost per unit of production of two goods, wheat and cloth in 2 countries X and Y with no transportation cost and free trade
X (Rs.) Y (Rs.)
Wheat 50 350
Cloth 100 500
Which one of the following will take place?
A.
No trade will take place
B.
X will export wheat and import cloth
C.
X will export cloth and import wheat
D.
There is no enough information to comment
Answer

Answer: Option D

Solution

Answer: Option D
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