Consider a world of two countries producing only wheat and cloth. In one hour, residents of Country A can produce 1 unit of wheat and 0.5 unit of cloth, whereas residents of Country B can produce 0.3 unit of wheat and 0.4 unit of cloth.

Country A should export A) wheat and cloth; country B should not export anything.
B) wheat and country B should export cloth.
C) nothing and country B should export both wheat and cloth.
D) cloth and country B should export wheat.

ANSWER:

B