Based on the information below, Nation A should specialise in the production ofgood, while Nation B should specialise in the production of goodLA == 100; LB = 200aLx = 6; aLY = 2bLX = 10; bLY = 5X;YY;XX;XY;Y

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Answered: Based on the information below, Nation…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Please note: for part i. of the question - the cost of copying is changing for the FOLLOWER COUNTRY (Country 2).
Which of the following statements about helping poor countries are true? a) Opening our markets to their trade is by far a more effective way to help them that giving them foreign aid? b) Opening our markets to their trade not only doesn't cost us, it provides a net benefit to our economy as well c) We should always give as much foreign aid as we can directly to their governments d) If the "recipient" country does not have a responsible government or much in the way of civil society, foreign aid should be limited to things such as fighting disease, aid that is provided directly to the people, such as microfinance or infrastructure project provided directly avoiding passing funds through the "recipient" country governments, and aid conditional on reforms to improvements governance. e) We should protect our domestic industries against the lower wages of the poorer countries, so we may giv them foreign aid but should never open our markets to them.
Suppose the Heckscher-Ohlin model was modified to allow for technology differences to exist between two trading countries. How would this change the Heckscher-Ohlin model's findings on factor prices, goods prices, and the gains from trade for each factor/industry over time? Also, explain how you would determine which good a country would import and which good a country would export.
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In the Heckscher-Ohlin model the factor that a country is abundant in will gain from trade, i.e. its income will increase. True False
Please examine the data describing unit labor requirements and labor productivity for two nations. These nations are only able to produce one of two items - ships and planes. Given this information, what is the value of the cell labeled B? Unit Labor Requirements Hours of labor required to produce one unit Inland Ships Planes 2 Harborton 4 1 0.5 Labor Productivity How many units can be produced in one hour Inland Harborton Ships A 0.25 Planes 1.0 B 2 units 1 unit 0.5 units O units
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Large gains from trade are most likely when countries are very different. True False
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Describe the international flow of resources
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Based on the information below, Nation A should specialise in the production of good, while Nation B should specialise in the production of good LA = = 100; LB = 200 aLx = 6; aLY = 2 bLX = 10; bLY = 5 X;Y Y;X X;X Y;Y