In Europa Universalis II, the isolation penalty is a multiplier for technology costs, which applies to any isolated country. A country is isolated in this sense if it currectly knows of 18 or fewer other countries. For your own country, you can see how many other countries are known by counting them on the Relationships submode of the diplomacy screen. There are 10 countries on a full page. The isolation penalty for a country is 0.2 for every country less than 18 which is known. That is, tech costs are multiplied as follows:
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