Use the production possibilities data below to answer the following question(s).
Table 2-3
Refer to Table 2-3. The farmer and the rancher both could benefit if the farmer were to specialize in
A) meat and the rancher were to specialize in potatoes.
B) potatoes and the rancher were to specialize in meat.
C) neither good and the rancher were to specialize in both goods.
D) none of the above; they cannot both benefit by specialization and trade.

Question

Use the production possibilities data below to answer the following question(s).
Table 2-3
 Refer to Table 2-3. The farmer and the rancher both could benefit if the farmer were to specialize in
A) meat and the rancher were to specialize in potatoes. 
B) potatoes and the rancher were to specialize in meat. 
C) neither good and the rancher were to specialize in both goods. 
D) none of the above; they cannot both benefit by specialization and trade.

Quizplus · Accepted Answer

By specializing in potatoes, the farmer can produce 300 pounds of potatoes and no meat. By specializing in meat, the rancher can produce 200 pounds of meat and no potatoes. This combination allows for both farmers to produce more than if they split their production between both goods, and they can then trade with each other to obtain the goods they do not produce. Therefore, the farmer specializing in potatoes and the rancher specializing in meat would result in the greatest benefit for both parties.

Use the Production Possibilities Data Below to Answer the Following