Question

True or flase, Trade can allow both participating countries to reach a point beyond their production possibilities frontier.

Answer 1

True.

Step-by-step explanation:

Trade between two countries allows both countries to consume products and services beyond their production borders, but it does not allow countries to produce beyond that border. This is because the production frontier is the term that refers to the total limit of products and services that a country is capable of producing, taking into account all the resources and technology it has. However, trade between two countries allows citizens to consume beyond the production frontier, since each country has access to the production of the other.