Y9

2. (12) Graph below the production possibility frontier for X and Y (X on the x-axis). Assuming the country is efficient and producing much more Y than X, select a point as the country's current production, labeling these X, and YA. Assume that the country's current price ratio Px/Py = Px"/Py" where Px" is the world price of X (Py" for Y) so that it is consuming exactly what it is producing. Explain and graph what happens when the demand for good X increases if the country is open to free trade including effects (if any) on consumption, imports/exports, and production