In the Following Graph Showing Indifference Curves for Country a (A₁)

question 26

Multiple Choice

In the following graph showing indifference curves for country A (a₁) and for country B (b₁) in a situation where both countries have the same production-possibilities frontier, in Autarky, P_X/P_Y in country A is __________ P_X/P_Y in country B, and, if trade begins, ountry A will export good __________.

• A) less than; X
• B) less than; Y
• C) greater than; X
• D) greater than; Y

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Definitions:

Physiological Needs

Basic physical requirements for human survival, such as air, water, food, shelter, and sleep.

State Of Balance

A situation or condition in which different elements are in the correct proportions or in an equilibrium state.

Establish

To set up or found something on a firm or permanent basis, often referring to institutions, organizations, or systems.

Defense Mechanism

Psychological strategies brought into play by individuals, groups, or even nations to cope with reality and to maintain self-image.