1. When will countries trade? Assuming 2 goods, food and clothing, and that both countries' preferences...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
1. When will countries trade? Assuming 2 goods, food and clothing, and that both countries' preferences are homothetic (but not necessarily identical), determine whether two countries will trade in each of the following situations: (a) Countries have identical preferences and identical endowments. (b) Countries have identical preferences, their endowments differ, and their endow- ments are not in the same ratio of food to clothing. (c) Countries have identical preferences, their endowments differ, but the ratio of food to clothing is the same in both countries. (d) Countries have identical endowments but different preferences. (e) Countries have both different preferences and different endowments 1. When will countries trade? Assuming 2 goods, food and clothing, and that both countries' preferences are homothetic (but not necessarily identical), determine whether two countries will trade in each of the following situations: (a) Countries have identical preferences and identical endowments. (b) Countries have identical preferences, their endowments differ, and their endow- ments are not in the same ratio of food to clothing. (c) Countries have identical preferences, their endowments differ, but the ratio of food to clothing is the same in both countries. (d) Countries have identical endowments but different preferences. (e) Countries have both different preferences and different endowments
Expert Answer:
Answer rating: 100% (QA)
we need to consider the concept of comparative advantage a If countries have identical preferences a... View the full answer
Related Book For
Posted Date:
Students also viewed these economics questions
-
Let A, B be sets. Define: (a) the Cartesian product (A B) (b) the set of relations R between A and B (c) the identity relation A on the set A [3 marks] Suppose S, T are relations between A and B, and...
-
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
-
In contrast to our analysis in Section 5.4.3, Carlton and Loury (1980) suggest that a Pigouvian tax alone will not lead to a long run social optimum for competitive polluting firms. Using their...
-
Refer to the facts of problem 44. Write a letter to Grant Industries explaining why it might want to recognize the entire gain on the condemnation. In Problem 44 Grant Industries' warehouse is...
-
The following information concerns production in the Forging Department for June.The Forging Department uses the average cost method. a. Determine the cost per equivalent unit.b. Determine the cost...
-
Browne Cleaning and Gardening Services commenced on 1 June 2026 when Lorne Browne contributed \($120\) 000 into a business bank account. Perhaps more thought could have been given to the business...
-
Glimmer Pools purchased $50,000 of 7% AKL bonds on January 1, 2018, at a price of 104.2 when the market rate of interest was 6%. Glimmer intends to hold the bonds until their maturity date of January...
-
MOTOROLA, INC., AND SUBSIDIARIES* CONSOLIDATED STATEMENTS OF OPERATIONS (IN PART) Years Ended December 31, (In millions, except per share amounts) 2008 2007 2006 Other Charges 3. Other Financial Data...
-
Analyze the current state of the Armed Services compensation system and address the existing pay structure used. Reference should be made to the job-based and person-based structure. Analysis should...
-
Describe the diversification strategy or plan that Kimbery Clark decided to pursue.
-
Ann wants a mortgage to buy a house. Ann gives the following information to the bank: Income: $240k/year or 20k/month Average monthly debt: $4k Estimated monthly Taxes + Insurance: $1,200...
-
Your suppliers provide you with credit terms of 21 days. Is it good business practice to pay within 7 days? Why or why not?
-
What is your perspective about US SAvings and loan crisis?
-
What are some the reasons why a salesperson would be reluctant to use a sales force automation system? Do you agree or disagree with this hesitancy? Why or why not
-
The interval of convergence of the power series (4x 20)" is n22n n=1 O (4, 6) o (4, 6] o 14, 6) o 13, 7) o 14,6)
-
Refrigerant-134a enters an adiabatic compressor as saturated vapor at 120 kPa at a rate of 0.3 m3/min and exits at 1-MPa pressure. If the isentropic efficiency of the compressor is 80 percent,...
-
From the 'trade flows data.xis' spreadsheet, identify a country with a trade deficit (other than the United States) and another with a trade surplus. Comment on what may be driving this deficit or...
-
Examine how the "optimal" tariff might change with different priorities of the political decision makers as follows. Again, use the parameters for the U.S.-ROW sugar model. (a) Plot unweighted...
-
Based on your results in questions (4) and (5), summarize what kind of countries tend to be more open, and what kind tend to be less open. Can you speculate as to why this is the case?
-
What are the six principles of good governance?
-
What are the three subject matter areas addressed by the COSO Framework?
-
What are the important aspects of internal control as identified in the COSO Framework?
Study smarter with the SolutionInn App