Technological Innovation and Exchange. Recall the example of Fred and Kate shown in Table 3.1 on page 77. Suppose a technological innovation, such as a rope ladder, increases the coconut productivity...

Technological Innovation and Exchange. Recall the example of Fred and Kate shown in Table 3.1 on page 77. Suppose a technological innovation, such as a rope ladder, increases the coconut productivity of both people: Fred can now produce three coconuts per day, while Kate can now produce two coconuts per day. Their productivity for fish has not changed. Suppose they agree to trade one coconut for each fish. Will both people gain from specialization and trade?