Given the following graph showing production-possibilities frontiers for country A and country B in a situation where both countries are on the same community indifference curve S₁ in autarky:

Prior to trade, P_X/P_Y in country A is __________ P_X/P_Y in country B, and, when trade begins, country A will import good __________.

Question

Given the following graph showing production-possibilities frontiers for country A and country B in a situation where both countries are on the same community indifference curve S₁ in autarky:

Prior to trade, P_X/P_Y in country A is __________ P_X/P_Y in country B, and, when trade begins, country A will import good __________.

Quizplus · Accepted Answer

The Answer of Given the following graph showing production-possibilities frontiers for country A and country B in a situation where both countries are on the same community indifference curve S₁ in autarky: Prior to trade, P_X/P_Y in country A is __________ P_X/P_Y in country B, and, when trade begins, country A will import good __________. A) greater than; X B) greater than; Y C) less than; X D) less than; Y

Given the Following Graph Showing Production-Possibilities Frontiers for Country a and Country