There are differences and similarities among the different trade models. Here are some of them: -The production possibilities frontier is different in each model. In the Ricardian model, the PPF is a single straight line because it assumes [ Select ] ,which implies that [ Select ] In the case of the Specific Factors and the Heckscher-Ohlin models, the PPF is a curve line because they assume I Select and diminishing returns.
There are differences and similarities among the different trade models. Here are some of them: -The production possibilities frontier is different in each model. In the Ricardian model, the PPF is a single straight line because it assumes [ Select ] ,which implies that [ Select ] In the case of the Specific Factors and the Heckscher-Ohlin models, the PPF is a curve line because they assume I Select and diminishing returns.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![There are differences and similarities among the different trade models. Here are some of them:
-The production possibilities frontier is different in each model. In the Ricardian model, the PPF
is a single straight line because it assumes
[ Select ]
which implies that
[ Select ]
. In the case of the Specific Factors and the Heckscher-Ohlin
models, the PPF is a curve line because they assume
[ Select ]
and
diminishing returns.
-The relative supply curve is also explained by different reasons in the models. While trade is
based only on
[ Select )
v in the Ricardian model, it depends only on
[ Select )
in the Heckscher-Ohlin model. The Specific Factors Model
combines these two possibilities.
-The gains from trade have similarities and differences among these models. While all of them
predict aggregate gains from trade, these are ( Select)
in the Ricardian
model. In the Specific Factors model, the owners of the immobile factor in the
[ Select)
v end up being worst off, and in the Heckscher-Ohlin model, the
group hurt by trade is the owners of the country's relatively ( Select )
factor.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff1f2849b-8f51-4253-ba4c-a3f87796b4b4%2F2b6354d5-822f-4b6d-a9ff-54d077f1a470%2F9csnp5c_processed.jpeg&w=3840&q=75)
Transcribed Image Text:There are differences and similarities among the different trade models. Here are some of them:
-The production possibilities frontier is different in each model. In the Ricardian model, the PPF
is a single straight line because it assumes
[ Select ]
which implies that
[ Select ]
. In the case of the Specific Factors and the Heckscher-Ohlin
models, the PPF is a curve line because they assume
[ Select ]
and
diminishing returns.
-The relative supply curve is also explained by different reasons in the models. While trade is
based only on
[ Select )
v in the Ricardian model, it depends only on
[ Select )
in the Heckscher-Ohlin model. The Specific Factors Model
combines these two possibilities.
-The gains from trade have similarities and differences among these models. While all of them
predict aggregate gains from trade, these are ( Select)
in the Ricardian
model. In the Specific Factors model, the owners of the immobile factor in the
[ Select)
v end up being worst off, and in the Heckscher-Ohlin model, the
group hurt by trade is the owners of the country's relatively ( Select )
factor.
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