Movement of Labor and Capital Between Countries In this question, we use the Rybezynski theorem to review the derivation of the Heckscher-Ohlin theorem. a. The accompanying diagram shows no-trade cquilibriums on the Home PPFS. Suppose that through immigration, the amount of labor in Home grows. Move point A to the point on the new PPF indicating where production would occur with the same prices for goods. b. The point you found in part a does not illustrate where the no-trade equilibrium will actually occur. Place point B at the true no-trade equilibrium point on the new PPF, after immigration. 20 19 18 Retative price 17 16 15 14 12 10Relative prce 7. 2. PPE PPF 01234 56789 10 11 12 13 14 15 16 17 18 19 20 Output of computen, Q Output of shoes, Q

Movement of Labor and Capital Between Countries In this question, we use the Rybezynski theorem to review the derivation of the Heckscher-Ohlin theorem. a. The accompanying diagram shows no-trade cquilibriums on the Home PPFS. Suppose that through immigration, the amount of labor in Home grows. Move point A to the point on the new PPF indicating where production would occur with the same prices for goods. b. The point you found in part a does not illustrate where the no-trade equilibrium will actually occur. Place point B at the true no-trade equilibrium point on the new PPF, after immigration. 20 19 18 Retative price 17 16 15 14 12 10Relative prce 7. 2. PPE PPF 01234 56789 10 11 12 13 14 15 16 17 18 19 20 Output of computen, Q Output of shoes, Q

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Hello, I am having problems with these two questions. Refer to attached picture for questions. Consider two countries, Korea and Malaysia, and two goods, lumber and automobiles. Korea’s PPF is biased towards automobiles, and Malaysia’s PPF is biased towards lumber. They have the normal, concave to origin, increasing opportunity cost shape.
Assuming Lesotho has a high intensity of labour abundance whilst Swaziland has a high intensity of capital abundance. Using the production possibilities curve and the HeckscherOhlin proposition, explain how Lesotho and Swaziland can gain from international trade by exchanging Chakalaka and Beer.
Below are hypothetical production possibilities tables for New Zealand and Spain. Each country can produce apples and plums. Referring to the tables, answer the following: Suppose the optimal product mixes before specialization and trade are alternative B in New Zealand and alternative S in Spain and the actual terms of trade are 1 plum for 2 apples. What will be the gains from specialization and trade?
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.
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Suppose Anguilla and Barbuda intend to trade 250 bananas (B) for 300 cocoa beans (C). In Anguilla, there are 30000 workers and 1B requires 10 workers while 1C requires 15 workers. Barbuda, with a labour force of 45 000, each banana requires 45 workers while harvesting cocoa beans requires 15 workers. From the information provided, answer the following questions. If both countries refuse to trade and allocates half its resource to each good, calculate each country’s production. With the intention to trade, determine which country holds the absolute and comparative advantage in each good. Determine the production of each country undertakes with the intention to trade. Suppose the countries trade, calculate their consumption after trade.…
QUESTION 3 In the Heckscher-Ohlin model with trade the wage in a country that produces both goods will depend on its labour abundance. True False
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