A representative of the American clothing industry recently made the following statement. “Workers in Asia often work in sweetshop conditions earning only pennies an hour. American workers are more productive and as a result earn higher wages. In order to preserve the dignity of the American work place, the government should enact legislation banning imports of low-wage Asian clothing” (a) Which parts are positive and normative statements? (b) Does the policy advocate consist of wages and productivities of America and Asian workers? (c) Whether the policy makes Americans better off or worse off. (d) Would low-wage Asian workers benefit from or be hurt by such policy? Concept Information: Positive Economics: It is based on facts and purely objective. It describes the economic issues without judging them. It is also referred to as "the economics of what is". To determine whether a statement is positive or not, we must analyze that whether the statement can be falsified or not. If it can be tested and proven, it is a positive statement. Normative Economics: It not only focuses on the economic issues but it judges them as well. It is based on values. It is also called the "economics of what ought to be". To identify a normative statement, one should look for modal verbs such as should, ought, or must.

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Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 10P

To determine

A representative of the American clothing industry recently made the following statement. “Workers in Asia often work in sweetshop conditions earning only pennies an hour. American workers are more productive and as a result earn higher wages. In order to preserve the dignity of the American work place, the government should enact legislation banning imports of low-wage Asian clothing”

(a) Which parts are positive and normative statements?

(b) Does the policy advocate consist of wages and productivities of America and Asian workers?

(c) Whether the policy makes Americans better off or worse off.

(d) Would low-wage Asian workers benefit from or be hurt by such policy?

Concept Information:

Positive Economics:

It is based on facts and purely objective. It describes the economic issues without judging them. It is also referred to as "the economics of what is". To determine whether a statement is positive or not, we must analyze that whether the statement can be falsified or not. If it can be tested and proven, it is a positive statement.

Normative Economics:

It not only focuses on the economic issues but it judges them as well. It is based on values. It is also called the "economics of what ought to be". To identify a normative statement, one should look for modal verbs such as should, ought, or must.

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Consider the simple discrete job search model that we studied in class. Only the unemployed can receive one offer per period from F(w) that is a uniform distribution on [0,2]. There is a constant probability of being laid off at the end of each period while employed. Assume that she can get a new offer right away when laid off. We want to understand the reservation wage, WR, in this model. Assume that u(c) = c. The parameters are a discount factor ẞ and an unemployment benefit b.R and show that T is contraction on [0, ∞). Explicitly state any additional assumptions that you may need.(Grading guide line: 5pt for the exact form of T, 10pt for showing contraction, and 5pt for stating correct assumptions.)< (b) Discuss why (a) is useful to understand the reservation wage wд in this economy.< (c) We write WR = WR (b,ẞ,λ) to reveal its dependence on (b,ẞ,λ). Show that 0 ≤ aWR дь OWR дл ≤1 and ≥0. What about ? awR ав State any additional assumptions that you may need.< (d) Briefly explain the…

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show written calculation for B

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Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 10P

To determine

A representative of the American clothing industry recently made the following statement. “Workers in Asia often work in sweetshop conditions earning only pennies an hour. American workers are more productive and as a result earn higher wages. In order to preserve the dignity of the American work place, the government should enact legislation banning imports of low-wage Asian clothing”

(a) Which parts are positive and normative statements?

(b) Does the policy advocate consist of wages and productivities of America and Asian workers?

(c) Whether the policy makes Americans better off or worse off.

(d) Would low-wage Asian workers benefit from or be hurt by such policy?

Concept Information:

Positive Economics:

It is based on facts and purely objective. It describes the economic issues without judging them. It is also referred to as "the economics of what is". To determine whether a statement is positive or not, we must analyze that whether the statement can be falsified or not. If it can be tested and proven, it is a positive statement.

Normative Economics:

It not only focuses on the economic issues but it judges them as well. It is based on values. It is also called the "economics of what ought to be". To identify a normative statement, one should look for modal verbs such as should, ought, or must.

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Answer 3

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Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 10P

To determine

A representative of the American clothing industry recently made the following statement. “Workers in Asia often work in sweetshop conditions earning only pennies an hour. American workers are more productive and as a result earn higher wages. In order to preserve the dignity of the American work place, the government should enact legislation banning imports of low-wage Asian clothing”

(a) Which parts are positive and normative statements?

(b) Does the policy advocate consist of wages and productivities of America and Asian workers?

(c) Whether the policy makes Americans better off or worse off.

(d) Would low-wage Asian workers benefit from or be hurt by such policy?

Concept Information:

Positive Economics:

It is based on facts and purely objective. It describes the economic issues without judging them. It is also referred to as "the economics of what is". To determine whether a statement is positive or not, we must analyze that whether the statement can be falsified or not. If it can be tested and proven, it is a positive statement.

Normative Economics:

It not only focuses on the economic issues but it judges them as well. It is based on values. It is also called the "economics of what ought to be". To identify a normative statement, one should look for modal verbs such as should, ought, or must.

Expert Solution & Answer

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Answer 4

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Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 10P

To determine