Is it possible to find equilibrium prices in a linear exchange model for six countries whose directed graph looks like the one below, and why? The arrows have the usual meaning, for example, the arrow from A to B means that country A is selling its product to country B. A BA C- D F E a. No, because it is not possible to go from C to F following the arrows. O b. Yes, because it is possible to go from any country to any other country following the arrows. Oc. Yes, as long as the countries' governments are conservative. O d. Yes, as long as inflation is low. e. No, because equilibrium prices never exist.

Is it possible to find equilibrium prices in a linear exchange model for six countries whose directed graph looks like the one below, and why? The arrows have the usual meaning, for example, the arrow from A to B means that country A is selling its product to country B. A BA C- D F E a. No, because it is not possible to go from C to F following the arrows. O b. Yes, because it is possible to go from any country to any other country following the arrows. Oc. Yes, as long as the countries' governments are conservative. O d. Yes, as long as inflation is low. e. No, because equilibrium prices never exist.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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