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- Question 5a) Identify and explain using appropriate diagrams the 2 main categories of gains from trade. b) Some economist recommends that countries should specialize in trade. What are 3 main disadvantages and 3 advantages of doing so.c) Using the table below, Calculate the Net Barter term of trade for each year using 2010 as the base year. YEAR PRICE OF EXPORTS PRICE OF IMPORTS QUANTITY EXPORTED 2010 100 100 100 2011 95 120 110 2012 80 110 120 c. Using the information provided above calculate the Income Term of trade. What can be observed between the Net Barter Term of trade and Income term of trade calculated. d. Explain he differences between the Ohlin and Leontif theory on factor abundance.Demand for imports (before $-devaluation) Demand for imports (after $-devaluation) Price of imports, in foreign currency (before $-devaluation) Yes No USA Japan 400 600 200 10 800 100 Suppose the $ is devalued: we go from Yen = $1/100 to Yen = $1/10. Does the Marshal-Lerner condition hold in this example?1-a) What is schematic balance of payments account table? Draw and explain. b) How does international trade effect economic growth?
- a. Define the concept of equilibrium in the foreign exchange market, from an Australian perspective, using Australian dollars (AUD) and New Zealand dollars (NZD) as your currencies. Explain the factors that might bring about a fall in the exchange rate. b. What is the likely impact on Australia’s economy of a fall in the exchange rate and what can be done to prevent this from happening?Under a system of flexible exchange rates, what will correct a deficit in a country's balance of payments? a. an appreciation in the nation's currency b. a decline in the nation’s domestic price level c. a depreciation in the nation's currency d. an increase in the nation’s inflation rate 2. Which of the following would supply Canadian dollars to the foreign exchange market? a. an increase in the number of Canadians going to Las Vegas over the holidays b. an increase in spending due to American tourists in Canada c. the sale of a Canadian corporation to a German investor d. the sale of wheat from Manitoba to a European bakeryJiz What are the effects on U.S. imports and exports when the U.S. experiences economic growth stronger than its major trading partners? Multiple Choice There will be no effect on US imports and exports. U.S. exports will increase more than U.S. imports. US imports will decrease, but U.S. exports will increase. Saved US imports will increase more than U.S. exports. Note: don't use chat bot.
- = A nation has a favorable balance of trade when Listen it has a surplus in its balance of payments. it has a deficit in its balance of payments. the value of its imports is greater than the value of its exports. merchandise exports exceed merchandise imports. it has high tariffs. K9) Which of the following can lead to an increase in the demand for Japanese yen compared to the U.S. dollar? a) an increase in the relative price of Japanese-made goods b) an increase in the interest rate in Japan relative to the U.S. rate c) a decrease in the amount of yen bought by the U.S. government d) a decrease in the demand for goods made in Japan 10) Which of the following statements is NOT true? a) If a country's exports exceed its imports, then there is a trade surplus. b) If the balance of trade is positive, then the balance of payments is also positive. c) If a country's balance of trade is positive, then its exports exceed its imports. d) A country's balance of trade includes trade in both goods and services.Imports Travel Civilian aircraft and parts Business services Royalties and license fees Agriculture Chemicals Financial services Transport Industrial machinery Automobile parts Ten largest U.S. exports Exports Five of the ten exports are services 25 50 75 100 125 150 175 200 225 Exports (billions of dollars per year)
- Exports goods and services that a country produces and then sells to other countries O A country's ability to produce more of a given product than another country O A country's ability to produce a product relatively more efficiently than another country O goods and services that one country buy from other countriesDo all international financial transactions involve exchanging one currency for another? Could a nation that neither imports nor exports goods and services still engage in international financial transactions? Explain: “U.S. exports earn supplies of foreign currencies that Americans can use to finance imports.”