2. Assume that Sweden and Norway currently producing and consuming soybeans and coffee. The following table 1 shows the prices of soybeans and coffee for both nations. Table 1: Prices of soybean and coffee Price (per carton) Soybeans (S) Coffee ($) Sweden Norway 64 85 71 82 Based on relative price of coffee, can Norway gain by exporting soybeans? If no, what commodity Norway should export? Briefly explain this scenario by using an appropriate diagram.
2. Assume that Sweden and Norway currently producing and consuming soybeans and coffee. The following table 1 shows the prices of soybeans and coffee for both nations. Table 1: Prices of soybean and coffee Price (per carton) Soybeans (S) Coffee ($) Sweden Norway 64 85 71 82 Based on relative price of coffee, can Norway gain by exporting soybeans? If no, what commodity Norway should export? Briefly explain this scenario by using an appropriate diagram.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter34: Globalization And Protectionism
Section: Chapter Questions
Problem 14SCQ: Assume a perfectly competitive market and the exporting country is small. Using a demand and supply...
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