The following graph shows the same PPF for Lamponia as before, as well as its initial consumption at point A. As you did for Maldonia, place a black point (plus symbol) on the following graph to indicate Lamponia's consumption after trade. Lamponia 64 56 Consumption After Trade 48 40 I 1 0 8 16 24 32 40 48 56 64 GRAIN (Millions of pounds) True or False: Without engaging in international trade, Maldonia and Lamponia would not have been able to consume at the after-trade consumption bundles. (Hint: Base this question on the answers you previously entered on this page.) True TEA (Millions of pounds) 16 8 0 PPF False

The following graph shows the same PPF for Lamponia as before, as well as its initial consumption at point A. As you did for Maldonia, place a black point (plus symbol) on the following graph to indicate Lamponia's consumption after trade. Lamponia 64 56 Consumption After Trade 48 40 I 1 0 8 16 24 32 40 48 56 64 GRAIN (Millions of pounds) True or False: Without engaging in international trade, Maldonia and Lamponia would not have been able to consume at the after-trade consumption bundles. (Hint: Base this question on the answers you previously entered on this page.) True TEA (Millions of pounds) 16 8 0 PPF False

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The graph shows Spain's demand for oranges and the supply of oranges by growers in Spain. The world price of oranges is €1.00 a pound. Draw and label the world price line. Suppose there is free international trade. Draw a point to show the quantity of oranges bought by Spanish consumers and the price they pay. Label it 1. Draw a point to show the quantity of oranges supplied by Spanish producers and the price at which these oranges are sold. Label it 2. With free international trade, Spain produces and some at the lower world price. imports exports W oranges than in the situation with no international trade
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Consider a simplified example of two countries - Singapore and Indonesia - producing two goods – telecommunications equipment and electrical circuit apparatus. Using all its resources, Singapore can produce either 50 telecommunications equipment, or 100 electrical circuit apparatus. Using all its resources, Indonesia can produce either 1,000 telecommunications equipment, or 5,000 circuit apparatus. (a) Which country/countries has/have the absolute advantages and the comparative advantages in the production of telecommunications equipment, and of electrical circuit apparatus? Explain and show. (b) Consider the case of constant opportunity cost. What will be the resulting patterns of trade, terms-of-trade, and the aggregate production and consumption? Provide a diagram to illustrate, with telecommunications equipment on the y-axis. (c) It is found that contrary to the above, there is no complete specialisation in both Singapore and Indonesia. Instead, Singapore partially specialises in…
3
Suppose a large country A initially imposed a tariff on its imports and is now considering removing its tariff. Use a domestic-market graph to a) show the effect of country A’s tariff removal on the world’s price, country A’s import price, import quantity, consumer surplus, producer surplus, and government revenue. b) identify country A’s net welfare change as a result of its tariff removal. Is country A unambiguously better off? c) Use a different graph to show how foreign producers will be affected by country A’s tariff removal? d) What factor determines the level of optimal tariff for country A? Please make sure to graph fpr both parts "a" and "c"
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Suppose now that Sylvania has a comparative advantage in the production of coffee. Again, Maldonia and Sylvania exchange 12 million pounds of lemons for 12 million pounds of coffee. The following graph shows the PPF for Sylvania, as well as its initial consumption at point A. Place a black point (cross symbol) on the following graph to indicate Sylvania's consumption after trade. 48 2 42 COFFEE (Millions of pounds) 38 PPF 30 24 18 122 O 0 6 12 Sylvania A 38 42 48 24 30 18 LEMONS (Millions of pounds) + Consumption After Trade ? <--Do graph After trade, Sylvania consumes million pounds of lemons as well as million pounds of coffee. 9, 12, 18, 24 9, 12, 18, 24 True or False: Without engaging in international trade, Maldonia and Sylvaniawould not have been able to consume at the after-trade consumption bundles. (Hint: Base this question on the answers you previously entered on this page.) O True O False
00 R Which producer would MOST likely be harmed from free trade? O domestic manufacturers that compete against foreign imports domestic manufacturers that use a lot of imported raw materials O domestic manufacturers that face no foreign competitors O domestic manufacturers that produce goods primarily for export 0 Unit 7 - Chapter 1.xlsx O Topic 2 (2).docx Topic 2 (1).docx Unit 7- Chapter 1.xlsx 73°F ins prt sc delete f8 LL 6) 144 I14 & backspace 7. D. 39 K. 7. sned W N 8
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