APPENDIX

307

ON of B exchanged for PN of A brings us to a point where
the range of indeterminateness in the terms of exchange has
vanished. The indeterminateness is seen to belong to the
stage of comparatively undeveloped exchange.
Hindrances to exchange modify the shape of the curves.
Thus, if the diagram of Fig. (vi) be supposed to represent the
conditions of a free exchange, and this is modified by the
imposition of a charge on the delivery of B without any
change in the services rendered to holders of either A or B,
the new conditions may be represented by replacing the
upper curve by another, derived from it by moving each
point of it horizontally to the right. The extent of the
movement must be such as to represent an amount of the
commodity B sufficient to discharge the amount of the levy
on delivery, and to leave the same net amount as before in
the hands of its purchaser. Substantially, the upper curve
is swung downwards to the right, its shape being modified,
if necessary, in addition, and its intersection with the lower
curve will give a position of OP lower than before. As the
curves stand in the figure, the extent of the exchanges will
be diminished, and a change in the rate of exchange will
result, so that holders of B will give more of their commodity
for each unit of A,
Fig. (vii) represents the conditions for forms of the
curves which bend
continuously in
one direction
throughout. A
point ¢ on the
upper curve gives
a point on the
modified curve, gp
representing the
delivery charge
in question, Draw
the ordinates PN,
pn, gm. Then, if
OP represent the
modified position
of the upper curve,
the new equilibrium
 is attained
at a rate of exchange,
 Oz of B

Fig. (vii)