Pe ce B CLOTH Change 3 While under constant cost conditions, there is complete specialisation of a country in the production of a commodity, under increasing cost conditions, complete specialisation is not possible. But, this does mean complete elimination of international specialisation and gains from trade under increasing cost conditions. The gains from trade under increasing cost conditions are illustrated in Figure-2. In Figure-2 PP, is the production possibility curve of India and P P. is the production possibility curve of England. The production possibility curve represents the maximum amount of one good that the country can produce for given amount of other good. Under the increasing cost conditions, the production possibility curve is concave to the origin which indicates that in order to produce more of one good, increasing amounts of other good are to be given up. PI were ernardum trade can haal specialis a lateraliore increases real face and catampou. This leads to experiental comploymom Sarimary of Gains from Incomational Adres Grand Dukete Intalieni upecialisation and eco- And it and promotes sont powth w from de Mough this exam massured? What factors atlect the door How does on om How are they determined 7 QUESTIONS CP We' We Pe Wi WI' WHEAT PI Fig. 2. 4=