The Following Simple Two-Country Question Illustrates How Countries Are Made

question 35

Essay

The following simple two-country question illustrates how countries are made better off by trade in assets. Imagine that there are two countries, Home and Foreign, and that residents of each own only one asset, domestic land yielding an annual harvest of kiwi fruit. Assume that the yield on the land is uncertain. Half the time, Home's land yields a harvest of 100 tons of kiwi fruit at the same time as Foreign's land yields a harvest of 50 tons. The other half of the time the outcomes are reversed. The Foreign's harvest is 100 tons, but the Home harvest is only 50.
-Calculate the average, for each country of kiwi harvest.

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Definitions:

Conscientiousness

A personality trait characterized by thoroughness, a strong sense of duty, and a disciplined approach to tasks.

Affiliation

A connection or association with a group or organization.

Achievement

The successful attainment of goals, milestones, or objectives, often marked by a sense of accomplishment and recognition.

Power

Power refers to the ability or capacity to direct or influence the behavior of others or the course of events.