The Dominican Republic and Nicaragua both produce coffee and rum. The Dominican Republic can produce 18 thousand tons of coffee per year or 9 thousand barrels of rum. Nicaragua can produce 8 thousand tons of coffee per year or 2 thousand barrels of rum.
a. Suppose the Dominican Republic and Nicaragua sign a trade agreement in which each country would specialize in the production of either coffee or rum.
Which country should specialize in coffee? (Click to select) The Dominican Republic Nicaragua
Which country should specialize in rum? (Click to select) The Dominican Republic Nicaragua
Answers: 3
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