Consider an international trade model consisting of three countries X, Y, and Z. Suppose X uses domestically, sends of its production to Y, and sends of its production to Z. Suppose Y uses domestically, sends of its production to X, and sends of its production to Z. Suppose Z uses sends of its production to X and sends of its production to Y. Assume this is a closed Leontief model. If we know country Z produced 28 thousand units of goods, then country X produces country Y produces thousand units of goods. of its production of its production of its domestic goods, thousand units of goods and
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- Consider an international trade model consisting of three countries X, Y, and Z. Suppose X uses domestically, sends of its production to Y, and sends of its production to Z. Suppose Y uses domestically, sends of its production to X, and sends of its production to Z. Suppose Z uses sends of its production to X and sends of its production to Y. Assume this is a closed Leontief model. of its production of its production of its domestic goods, If we know country Z produced 124 thousand units of goods, then country X produces country Y produces thousand units of goods. thousand units of goods andConsider an international trade model consisting of three countries X, Y, and Z. Suppose X uses of its production domestically, sends of its production to Y, and sends of its production to Z. Suppose Y uses of its production domestically, sends of its production to X, and sends of its production to Z. Suppose Z uses of its domestic goods, sends of its production to X and sends of its production to Y. Assume this is a closed Leontief model. If we know country Z produced 344 thousand units of goods, then country X produces a 430 thousand units of goods. thousand units of goods and country Y producesTrade theories suggest that both countries gain from trade. In a 2-country, 2-good model, we assume the 2 states—Futland and Tandam share a common currency (allowing us to ignore exchange rate), they both have the same wages, and they both produce two goods: bicycles and boots. The units of labour requirement are shown below, assuming constant returns to scale. Production Techniques: Units of labour hour required per unit output Tandom Futland Bicycles 90 hours 120 hours Boots 30 hours 50 hours Define opportunity cost. Using the table above, calculate the opportunity cost of bicycles in terms of boots and the opportunity cost of boots in terms of bicycles for each of the countries.
- Trade theories suggest that both countries gain from trade. In a 2-country, 2-good model, we assume the 2 states—Futland and Tandam share a common currency (allowing us to ignore exchange rate), they both have the same wages, and they both produce two goods: bicycles and boots. The units of labour requirement are shown below, assuming constant returns to scale. Production Techniques: Units of labour hour required per unit output Tandom Futland Bicycles 90 hours 120 hours Boots 30 hours 50 hours iii. Which country has a comparative advantage in the production of each of the two goods?Trade theories suggest that both countries gain from trade. In a 2-country, 2-good model, we assume the 2 states—Futland and Tandam share a common currency (allowing us to ignore exchange rate), they both have the same wages, and they both produce two goods: bicycles and boots. The units of labour requirement are shown below, assuming constant returns to scale. Production Techniques: Units of labour hour required per unit output Tandom Futland Bicycles 90 hours 120 hours Boots 30 hours 50 hours i. Briefly explain absolute advantage theory by Adam Smith and comparative advantage theory by David Ricardo. Which country has an absolute advantage in the production of each good?Using the Heckscher-Ohiln trade model, we would expect that in a nation that is labor abundant that exports potatoes, an increase in the quantity of land (the other factor of production) would... A) Worsen the terms of trade for that nation B) Improve the terms of trade for that nation C) Raise wages in that nation D) Both B and C
- QUESTION 1.Consider a standard Heckscher-Ohlin model with two countries: Germany is capital-abundant; Malaysia is labour-abundant. Each country uses labour and capital to produce two goods: Good 1 is labour-intensive and Good 2 iscapital-intensive. Under free trade, the world relative price of Good 2 will be: (a) Lower than the relative price of Good 2 under autarky in Malaysia.(b) Lower than the relative price of Good 2 under autarky in Germany.(c) Lower than the autarky relative price of Good 2 in both countries.(d) Higher than the autarky relative price of Good 2 in both countries. Explain why.Which situation describes when mutually beneficial trade occurs? Group of answer choices Country A has a comparative advantage in producing strawberries. Country B has a comparative advantage in producing kiwis. Country A increases production of strawberries, and Country B increases production of kiwis. When Country A trades with Country B to obtain kiwis, and when Country B trades with Country A to obtain strawberries, both countries can benefit. Country A has a comparative advantage in producing strawberries. Country B has a comparative advantage in producing kiwis. Country A increases production of strawberries, and Country B decreases production of kiwis. When Country A trades with Country B to obtain kiwis, and when Country B trades with Country A to obtain strawberries, both countries can benefit. Country A has a comparative advantage in producing strawberries. Country B has a comparative advantage in producing kiwis. Neither country wants any of the produce they…Choose four countries. One country in North America, another country in Central America, another country in the Caribbean and another country in South America and indicate, using the gravity model, which factors should increase or reduce trade between those countries. After that, choose a country in Europe and indicate, using the Gravity Model, how the intensity of trade changes with five countries. You must take into account the concept of the gravity model and the factors that affect trade such as language, culture, trade agreements, among others. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
- Use the following information to answer question: Assume the standard trade model with two countries (Alpha and Beta), two goods (food and drink), and two factors of production (land and labor). Further assume that Alpha is relatively labor-abundant; food is relatively labor intensive; drink is relatively land intensive. The pre-trade price of food in Alpha is while the pre-trade price of food in Beta is than the price of drink in Alpha than the price of drink in Beta. Greater; greater Less; less Less; greater Greater; LessConsider two nations, Nation A and Nation B: "Excellent," the representative from Nation A says. "We will now open up to trade. We will produce 2000 units of wheat. Half of this will be traded to you in exchange for apples as agreed." "We are in agreement!" the representative from Nation B says. "We'll produce 1000 apples and will trade 800 of them to you in exchange for half of your wheat." As a result of these terms of trade, Nation A will have units of wheat to consume and will import apples from Nation B. O 2000; 1000 O 1000; 1000 O 2000; 800 O 1000; 800 Question 9 2.5 pts MacBook Air 吕口 F3 000 D00 F4 F5 F6 F7 F8 F9 $ & 4 7 8 RConsider a two country, two goods, one factor (labor) model of international trade. Suppose home country require 1 units of labor to produce a unit of cloth and 1 unit of labor to produce a unit of wine (regardless of output levels). Foreign country requires 2 unit of labor to produce 1 unit of cloth and 1.5 units of labor to produce 1 unit of wine (regardless of output levels). (a) Which country has the comparative advantage in producing wine? Justify your answer. (b) Which country has the absolute advantage in producing wine? (c) Which country will have higher autarky price of wine in terms of cloth? (d) Suppose after trade, the international relative price settles at a level strictly between the autarky relative prices of the two countries. At the trade equilibrium, show which country will produce wine and which country will produce cloth.