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Consider the No-Trade Input/output Situation Presented in the Following Table

Question 88

Multiple Choice

Consider the no-trade input/output situation presented in the following table and graph for South and North Carolina.Assume that free trade is legal. Input/Output without Trade

     country  
  south carolina   north carolina  total
 I. total potintal output      
 (lbs. or yard; 000,000s)      
guns 500  250  750
butter  1,000  750  1,750
 II. consumption      
  (lbs. or yard; 000,000s)      
guns 250 200  450
butter  500 150   650
What is the relative price of a pound of butter in terms of guns in North Carolina?


A) 1 pound of butter costs 0.33 guns.
B) 1 gun costs 0.33 pounds of butter.
C) 1 pound of butter costs 0.66 guns.
D) 2 guns costs 0.66 pounds of butter.

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