From the diagram, JK represents the country’s production possibility curve. LK is the trading possibility curve, showing the combinations of good X and good Y it can obtain after specialising in the product for which it has comparative advantage and then trading that product. The country consumes OR of good X and OT of good Y. What quantities of goods X and Y does it produce?
- Agood X: JS; good Y: OT
- Bgood X: OS; good Y: OT
- Cgood X: RS; good Y: TK
- Dgood X: zero; good Y: OK