In 1994, the United States, Canada, and Mexico formed the North American Free Trade Agreement (NAFTA), which was designed to provide each member nation better access to the markets, labor, and technology of the others. This agreement was updated in 2020 to become the U.S.-Mexico- Canada Agreement (USMCA), which contains about 90% of the original provisions of NAFTA, with several updates. Complete the following table by indicating whether each property represents an element of the 1994 North American Free Trade Agreement (NAFTA), or an update unique to the 2020 U.S.-Mexico-Canada Agreement (USMCA). Property 75% of the value of manufactured cars and trucks must be produced in North American factories Freedom to transfer and store digital information across Canada, Mexico, and the U.S. Allowances for some tariffs on digital products No rules regarding currency manipulation NAFTA O O O USMCA O O O

In 1994, the United States, Canada, and Mexico formed the North American Free Trade Agreement (NAFTA), which was designed to provide each member nation better access to the markets, labor, and technology of the others. This agreement was updated in 2020 to become the U.S.-Mexico- Canada Agreement (USMCA), which contains about 90% of the original provisions of NAFTA, with several updates. Complete the following table by indicating whether each property represents an element of the 1994 North American Free Trade Agreement (NAFTA), or an update unique to the 2020 U.S.-Mexico-Canada Agreement (USMCA). Property 75% of the value of manufactured cars and trucks must be produced in North American factories Freedom to transfer and store digital information across Canada, Mexico, and the U.S. Allowances for some tariffs on digital products No rules regarding currency manipulation NAFTA O O O USMCA O O O

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Q13
Kazakhstan is an apple producer, as well as an importer of apples. Suppose the following graph shows Kazakhstan's domestic market for apples, where SK is the supply curve and Dx is the demand curve. The free trade world price of apples (Pw) is $200 per ton. Suppose Kazakhstan's government restricts imports of apples to 200,000 tons. The world price of apples is not affected by the quota. Analyze the effects of the quota on Kazakhstan's welfare. On the following graph, use the purple line (diamond symbol) to draw the Kazakhstan's supply curve including the quota SK+Q. (Hint: Draw this as a straight line even though this curve should be equivalent to the domestic supply curve below the world price.) Then use the grey line (star symbol) to indicate the new price of apples with a quota of 200,000 apples. PRICE (Dollars per ton) 1000 900 800 700 600 500 400 300 200 100 0 0 50 SK Pw W 100 150 200 250 300 350 400 450 500 QUANTITY (Thousands of tons) SK+Q Price with Quota A Change in PS Quota…
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Ahead of the enlargement of the EU in early 2000s with 12 new members, there was a huge debate regarding the social protection of workers. What do we mean by social dumping and what are its possible effects on the EU labour market? Looking at the table above, could you conclude that social protection of EU workers decreased due to the integration of 12 new member States? Explain your answer Despite the possible consequences of social dumping on the integration process, the EU did not centralise the decisions regarding social protection in the labour market. What would be the reasoning behind such a decision?
Assume that the comparative-cost ratios of two products-baby formula and tuna fish-are as follows in the nations of Canswicki and Tunata: Canswicki: 1 can baby formula = 3 cans tuna fish Tunata: 1 can baby formula = 5 cans tuna fish a. In what product should each nation specialize? Canswicki should produce [(Click to select), and Tunata should produce [(Click to select) ♥ b. Would the following terms of trade be acceptable to both nations? i. 1 can baby formula = 2 cans tuna fish: (Click to select) ii. 1 can baby formula = 3.5 cans tuna fish: (Click to select) iii. 1 can baby formula = 6 cans tuna fish: (Click to select)
Suppose that a worker in Country A can produce either 6 units of corn or 2 units of wheat per year, and a worker in Country B can produce either 2 units of corn or 6 units of wheat per year. Each nation has 10 workers. Without trade, Country A produces and consumes 30 units of corn and 10 units of wheat per year. Country B produces and consumes 10 units of corn and 30 units of wheat. Suppose that trade is then initiated between the two countries, and Country A sends 30 units of corn to Country B in exchange for 30 units of wheat. Country A will now be able to consume a maximum of Select one: a.30 units of corn and 30 units of wheat. b.40 units of corn and 20 units of wheat. c.40 units of corn and 30 units of wheat. d.10 units of corn and 40 units of wheat.
In 2020, Spain had a population of 46 million and its capital stock was US$90,000 billion. The corresponding figures for Australia were 26 million and US$75,000 billion. Suppose computer-chips manufacturing is capital-intensive relative to food processing. As such, in a two-factor, two-commodity and two-country world, Australia would have exported computer-chips to Spain and imported processed foods from Spain. Do you agree? Justify your answer using an appropriate trade model
This assignment assumes demand and supply schedules for widgets P=120-3Qd and P = 40 +2QS Please record your answers without dollar signs. Now suppose this country can purchase all the widgets it wants at a world price of P = 48. When the country opens up to trade, the price that will prevail in this marketplace will be the world price, P= 48. This assumption applies for the remainder of the questions. Consumer Surplus for buyers (consumers) in this country will now equal QUESTION 9 Producer Surplus for sellers in this country will now equal QUESTION 10 Total Consumer and Producer Surplus will be dollars. dollars dollars
Much of the world’s current economic activities is concentrated in a group of countries called the Triad (Japan, EU and United States). What is the potential threat of China to these international economic drivers?
Now, suppose that Island is a large exporting country with the following demand and supply functions and the free-trade world price is $5,000 per unit. D = 900,000 − 150P and S = 100,000 + 50P The Island government offers an export subsidy that increases the domestic market price to $5,500 and lowers the world price to $4,500. However, starting next month, the Island government will be removing the export subsidy in compliance with the latest international trade pact. A. What is the impact of the removal of the subsidy on domestic consumers? B. What is the change in producer surplus due to the movement to free trade? C. What is the net effect of moving to free trade on Island welfare?
In 2009, US imposed a tariff of 35% on radial car tires imported from China. The winners from this tariff are US producers and there was tariff revenue earned from this tariff. Trade restrictions are quite common in international trade. Can you argue in favor of this type of trade restriction ? Do we have a national security argument, infant industry argument or a dumping argument and why
Consider the market for meekers in the imaginary economy of Meekertown. In the absence of international trade, the domestic price of meekers is $30. Suppose that the world price of meekers is $40. Assume that Meekertown is too small to influence the world price of meekers once it enters the international market. If Meekertown allows free trade, then it will meekers. Given current economic conditions in Meekertown, complete the following table by indicating whether each of the statements is true or false. Statement True False Meekertownian consumers are worse off under free trade than they were before. Meekertownian producers were better off without free trade than they are with it. True or False: When a country is too small to affect the world price, allowing free trade will have a non-negative effect on total surplus in that country, regardless of whether it imports or exports as a result of international trade. O True False