MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
11th Edition
ISBN: 9781264207718
Author: Colander
Publisher: MCG CUSTOM
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Question
Chapter 9, Problem 4QE
(a)
To determine
Explain the movement of two countries from the initial point to the new point.
(b)
To determine
Identify the total production for the two countries.
(c)
To determine
Identify the
(d)
To determine
Identify the change in analysis if the per unit cost of production falls with rising output.
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Students have asked these similar questions
Who are the winners and losers of the free trade between two countries? Can free trade between the two countries make consumers of both countries better off?
In answering this question, consider discussing:
How are you and your household connected to the global economy? Which imported goods and services do you buy?
Are your consumption patterns based on comparative advantage?
How do US trade patterns, based on comparative advantage, contribute to income inequality in the US, according to the Heckscher-Ohlin model?
How has trade affected international income inequality?
What were some recent tariffs? Who really pays the cost of tariffs?
Y
100
Country A
X
Y
40
Country B
40
X
20
a) How much of Good Y will Country B produce if they specialize in their comparative advantage? 40
b) By themselves, if Country B produces 18 units of Y, what is the maximum amount they could produce of Good X? 18
c) If the terms of trade proposed are 5 X for 10Y, how much will Country B be able to consume of Good Y after trade if they specialize in
their comparative advantage before trading? 40
Suppose Argentina (A) and Bolivia (B) only trade with each other and they both
produce the same two goods: grocery (G) and fish (F). Given its resources, Argentina
can produce either 2 units of grocery per day or 1 unit of fish; Bolivia can produce
either 5 units of grocery or 4 units of fish.
a. If there were no trade, what would be the local price of fish in each country,
measured in units of grocery?
b. If trade is allowed, which country will export fish and which country will export
grocery (if any)?
c. Suppose Argentina offers to buy fish from Bolivia for 1.20 units of grocery. Does
Bolivia accept the trade? Why or why not?
d. With trade, what are the bound of the price of fish, measured in units of grocery?
Chapter 9 Solutions
MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
Ch. 9.1 - Prob. 1QCh. 9.1 - Prob. 2QCh. 9.1 - Prob. 3QCh. 9.1 - Prob. 4QCh. 9.1 - Prob. 5QCh. 9.1 - Prob. 6QCh. 9.1 - Prob. 7QCh. 9.1 - Prob. 8QCh. 9.1 - Prob. 9QCh. 9.1 - Prob. 10Q
Ch. 9 - Prob. 1QECh. 9 - Prob. 2QECh. 9 - Prob. 3QECh. 9 - Prob. 4QECh. 9 - Prob. 5QECh. 9 - Prob. 6QECh. 9 - Prob. 7QECh. 9 - Prob. 8QECh. 9 - Prob. 9QECh. 9 - Prob. 10QECh. 9 - Prob. 11QECh. 9 - Prob. 12QECh. 9 - Prob. 13QECh. 9 - Prob. 14QECh. 9 - Prob. 15QECh. 9 - Prob. 16QECh. 9 - Prob. 17QECh. 9 - Prob. 18QECh. 9 - Prob. 19QECh. 9 - Prob. 1QAPCh. 9 - Prob. 2QAPCh. 9 - Prob. 3QAPCh. 9 - Prob. 4QAPCh. 9 - Prob. 5QAPCh. 9 - Prob. 1IPCh. 9 - Prob. 2IPCh. 9 - Prob. 3IPCh. 9 - Prob. 4IPCh. 9 - Prob. 5IP
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