国际经济学（英文）课件CHAPTER3.pptVIP

Chapter 3 Chapter 3 The Standard Theory of International Trade Outline Main Contents The Production Frontier (Increasing Costs) Community Indifference Curves Equilibrium in Isolation The Basis for and the Gains from Trade Importance of Tastes 3.1 Main Content Under Increasing Opportunity Costs 3.2 The Production Frontier  with Increasing Costs Illustration of Increasing Costs Characters of Production Frontier Marginal Rate of Transformation (MRT) Characters Negative slope Concave from the origin Opportunity Cost X = sacrifice/ gain = △Y /△X 3.3 Community Indifference Curves Definition Illustration of the curves Marginal Rates of Substitution (MTS) Definition Cf. ——Individual’s Indifference Curves A Community (Social) Indifference Curves shows the various combinations of two commodities that yield equal satisfaction to the community or nation. Characters —1 Higher curves refer to greater satisfaction Negative slope Convex from the origin Absolute slope of the line = sacrifice/ gain = △Y /△X Characters —2 3.4 Equilibrium in Isolation Illustration Equilibrium-Relative Commodity Prices Comparative Advantage Equilibrium-Relative Commodity Prices  and Comparative Advantage Nation 1 PA = PX / PY = 1/4 Nation 2 PA’ = PX / PY = 4 3.5 Basis Gains  —Trade with Increasing Costs Illustration Equilibrium-Relative Commodity Prices Incomplete Specialization（See P71 CASE Study 3-2） Small-Country Case： Gains from Exchange Specialization Small-Country Case: — with Increasing Costs Assumption On world market: PW = 1 In small nation 1: PA = 1/4 3.6 Importance of Tastes — Trade Based on Difference in Tastes Assumption : in two nations Identical Production Frontier Different Tastes/ Demand Preference Problems P79-80 :3, 4, 5, 7, 12 * * Supply Demand Equilibrium-relative Commodity Price Before Trade After Trade the Gains from Trade Comparative Advantage The Force of Supply FI