10 Questions
In autarky, what limits the consumption of product X in country A?
The ratio of complementarity
In autarky, what represents the level of well-being for country B?
Point CB on the right graph of figure 1
What is the surplus of product X in country A in autarky?
(3/2) - (1/4)
What does the distance between point CA and point D on the left graph of figure 1 represent?
The surplus of product X in country A
What limits the consumption of product Y in country B during autarky?
The ratio of complementarity
According to the passage, what does the bilateral international trade allow two countries to do?
Better satisfy each other's needs
In the context of the passage, what is represented by point DA on the graph?
The initial dotation of country A for product X
Based on the information provided, what can be inferred about the preferences for products X and Y in each country?
They are only consumed in fixed proportions in each country
What does the Leontief model illustrate according to the passage?
How countries can satisfy their reciprocal needs through international trade
Why does bilateral international trade become beneficial for two countries with different preferences and resources?
It allows them to specialize according to their comparative advantages
This quiz covers the concept of bilateral international trade and its illustration using the Leontief model with preferences. It discusses how two countries can better satisfy their reciprocal needs through international trade when their preferences and resources differ significantly.
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