Consider two people: Dave and Mary. They can each produce tw…
Consider two people: Dave and Mary. They can each produce two goods: corn and wheat. If Dave produces only corn, he can produce 10 units a day. If Dave produces only wheat, he can produce 5 units a day. If Mary produces only corn, she can produce 6 units a day. If Mary produces only wheat, she can produce 8 units a day. Assume their PPFs are linear. Suppose Dave and Mary decide to trade. The range of prices for corn at which gains from trade exist is
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