Given the Diagram Below, in Which Country a Is Producing

question 28

Multiple Choice

Given the diagram below, in which country A is producing at point P and consuming at point C:

Country A is __________, and the ratio of the price of food relative to the price of books [i.e., (P_food/P_books) ] reflected by price line P₀ is __________ than the (P_food/P_books) ratio that existed when country A was in autarky.

• A) exporting food and importing books; lower
• B) exporting food and importing books; higher
• C) exporting books and importing food; lower
• D) exporting books and importing food; higher

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Definitions:

Physical Material

Substances or components that have mass and occupy space; can be observed and measured physically.

Constant

A fixed value that does not change.

Particles

The small, localized physical entities that make up the structure of matter, ranging from elementary particles to atoms and molecules.

Ordered State

A condition of a system in which its components are arranged in a well-organized pattern or structure, often resulting in reduced entropy.