Assuming that both countries specialize where they have the comparative advantage, which of the following are possible terms of trade between Country X and Country Y that would benefit both countries?
1) Country X exports goods that it has a comparative advantage in producing, and Country Y exports goods that it has a comparative advantage in producing.
2) Country X exports goods that it has a comparative advantage in producing, and Country Y imports goods that it has a comparative advantage in producing.
3) Country X imports goods that it has a comparative advantage in producing, and Country Y exports goods that it has a comparative advantage in producing.
4) Country X imports goods that it has a comparative advantage in producing, and Country Y imports goods that it has a comparative advantage in producing.