2. (a) What does the index of intra-industry trade measure and doesit tell us anything about the total amount of trade?(b) There are two ways of measuring the degree of intra-industry tradewithin an industry:min (imports, exports)Index of intraindustry trade =12 (imports + exports)-(lexpe(lexports - imports|exports + importsGrubel Lloyd index = 1 -Using the first formula, calculate the index of intra-industry trade forthe U.S in 2014 for the products on Table 1.Using your answer in (b) above, what does the index of intra-industry trade of men's shorts, large passenger aircraft, telephonesand golf carts tell us?(d) What are the two necessary conditions to obtain a highindex of intra-industry trade?

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2. (a) What does the index of intra-industry trade measure and does it tell us anything about the total amount of trade? (b) There are two ways of measuring the degree of intra-industry trade within an industry: Index of intraindustry trade = min (imports, exports)

2. (a) What does the index of intra-industry trade measure and does it tell us anything about the total amount of trade? (b) There are two ways of measuring the degree of intra-industry trade within an industry: Index of intraindustry trade = min (imports, exports)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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