If Ecuador has an absolute advantage in coffee and Argentina in wheat, then, according to trade theory
A. the gains in trade by both countries will be equal.
B. Argentina should focus on producing coffee and trade for wheat.
C. Ecuador should focus production on coffee and trade for other goods.
D. Ecuador would do well to produce its own wheat rather than import it from Bolivia.
E. there will be a perfect trade balance between the two countries.
Answer: C
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