Explain with the help of offer curve how the gains from trade are distributed
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The distribution of gains from trade can be explained in terms of Marshall-Edgeworth offer curve through.The exchange takes place at P where the two offer curves cut each other. Country A imports PQ quantity of Y and exports OQ quantity of X.
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trade is explained in terms of the Marshall-Edge worth offer curves in Fig. 80.2. OA is the offer curve of country A, and OB of country B. OP and OQ are the domestic constant cost ratios of producing о X and Y in country A and В respectively.
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