Imagine that you work for the World Bank and you have been called to Ghana to aid the new president to come up with a new international trade strategy.You are told that the new government is interested in moving away from agriculture and into manufacturing. To do so, the government wants to pursuit a policy of import substitution industrialization (ISI).You are given a brief about Ghana highlighting the following points:About half of Ghana’s population depends on agriculture, but Ghana still imports some of its food.The majority of Ghana's people live in rural areas and exist on a subsistence way of life.Ghana has one of the highest rates of income inequality in the world.Nearly half of the population is employed in agriculture. Ghana imports and exports food from and to neighbouring Côte d'Ivoire. The latter nation is very similar to Ghana in most ways. Can you explain what may drive two very similar nations to trade?

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Imagine that you work for the World Bank and you have been called to Ghana to aid the new president to come up with a new international trade strategy.

You are told that the new government is interested in moving away from agriculture and into manufacturing. To do so, the government wants to pursuit a policy of import substitution industrialization (ISI).

You are given a brief about Ghana highlighting the following points:

About half of Ghana’s population depends on agriculture, but Ghana still imports some of its food.
The majority of Ghana's people live in rural areas and exist on a subsistence way of life.
Ghana has one of the highest rates of income inequality in the world.
Nearly half of the population is employed in agriculture.

Ghana imports and exports food from and to neighbouring Côte d'Ivoire. The latter nation is very similar to Ghana in most ways. Can you explain what may drive two very similar nations to trade?

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