Bilateral International Trade and Leontief Model
10 Questions
1 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

In autarky, what limits the consumption of product X in country A?

  • The ratio of endowments
  • The surplus of product Y
  • The ratio of complementarity (correct)
  • The surplus of product X

    • In autarky, what represents the level of well-being for country B?

  • The ratio of endowments
  • Point CB on the right graph of figure 1 (correct)
  • The surplus of product Y
  • The ratio of complementarity

    • What is the surplus of product X in country A in autarky?

  • (3/2) - (1/2)
  • (3/2) - (1/4) (correct)
  • (1/2) - (1/4)
  • (5/4) - (1/2)

    • What does the distance between point CA and point D on the left graph of figure 1 represent?

    <p>The surplus of product X in country A</p> Signup and view all the answers

    What limits the consumption of product Y in country B during autarky?

    <p>The ratio of complementarity</p> Signup and view all the answers

    According to the passage, what does the bilateral international trade allow two countries to do?

    <p>Better satisfy each other's needs</p> Signup and view all the answers

    In the context of the passage, what is represented by point DA on the graph?

    <p>The initial dotation of country A for product X</p> Signup and view all the answers

    Based on the information provided, what can be inferred about the preferences for products X and Y in each country?

    <p>They are only consumed in fixed proportions in each country</p> Signup and view all the answers

    What does the Leontief model illustrate according to the passage?

    <p>How countries can satisfy their reciprocal needs through international trade</p> Signup and view all the answers

    Why does bilateral international trade become beneficial for two countries with different preferences and resources?

    <p>It allows them to specialize according to their comparative advantages</p> Signup and view all the answers

    More Like This

    Use Quizgecko on...
    Browser
    Open
    Browser
    Browser