AP Macro Unit 5 Summary

PineapplesRadiosKenyaIndia30 10(1P costs 1/3R) (1R costs 3 P)40 40(1P costs 1R) (1R costs 1P)Trading 1 radio for 2 pineapples will benefit bothIf Kenya produces radios by themselves, they giveup 3 Pineapples for each radio. If they can trade 2pineapples for each radio they are better off.If India produces pineapples by themselves, theygive up 1 pineapple for one radio. If they can get 2pineapples for one radio they are better off.The countries trade at a lower opportunity costthan if they made the products themselves!