international trade  Consider an H-0 economy in which there are two countries (US and France), two goods (wine and cheese) and two factors (capital and labor). Q1: Suppose France exports wine, the capital-intensive good. Which factor benefits

Q: Openness to trade measures A   the inverse of the average time needed to comply with customs forms…

A: The openness to trade can be defined as the ratio of the total to the GDP of the country.

Q: Consider an H-0 economy in which there are two countries (US and France), two goods (wine and…

A: Trade is defined as the exchange of commodities and services across the boundary of the country.

Q: Between two, the producer that requires a smaller quantity of inputs to produce a good     Has an…

A: In a market, producers cam gain different types of competitive advantage based on their…

Q: The U.S. currently trades with China. Suppose the U.S. has a comparative advantage in the production…

A: A country is said to have comparative advantage in producing a good if the opportunity costs of…

Q: International trade  Consider an H-0 economy in which there are two countries (US and France), two…

A: One of the most prominent models of international trade is the Heckscher-Ohlin model. By introducing…

Q: Which of the following statements is NOT true? Group of answer choices   In a two-good market, a…

A: If the domestic price of a good is less than the world price of the good then a nation is going to…

Q: Generally, the losses due to free trade are ________, and the benefits are ________. a.…

A: Free trade benefits the economy as a whole as it allows economy to consume beyond its production…

Q: A country will have comparative advantage, accounting to Ricardo (A) industries that sell to…

A: Meaning of Exchange Rate: The term exchange rate refers to the situation under which a particular…

Q: Calculate the gains from trade—that is, the amount by which each country has increased its…

A: The question is based on comparative advantage trade. Comparative advantage is when a country is…

Q: In 2017, Ecuador's biggest export was crude (unprocessed) petroleum, 63% of which it exported to the…

A: A country is said to have a comparative advantage when a lower opportunity cost a country poses to…

Q: Declining transportation and communication costs in recent decades have enabled many domestic…

A: With the rise of globalization, movement of goods, services has become seamless. MNCs from the…

Q: True or false? Free trade causes job losses in industries in which a country does not have a…

A: International trade: - it means the buying and selling of goods and services with other countries.

Q: he decision to introduce a tariff, or indeed some other policy instrument that impacts trade, is…

A: Tariffs are restrictions that are imposed by the government of the country in order to decrease the…

Q: President Trump is currently getting tough on trade. This means he wants terms of trade so that…

A: Terms of trade refer to the price of exports in terms of the price of imports. Betterment of terms…

Q: Question 15 Which of the following statements is correct? Two countries can gain from specialization…

A: Option A is correct.  Option D is incorrect as gains from trade is based on comparative advantage…

Q: An economic boom in the United States will tend to cause booms in other countries because as U.S.…

A: Exchange rate refers to the amount of domestic currency that required to purchase one unit of…

Q: Q.1.1 Kenya has a comparative advantage over Uganda in the production of sugar if it:  (1) Is able…

A: Comparative advantage is capability of an economy to produce a good at a lesser opportunity cost…

Q: We can conclude that Morocco has a comparative advantage in the production of tables. [True or…

A: Comparative advantage refers to the ability of a country or an individual to produce the good at a…

Q: Question 18 Which of the following statements is correct? The gains from specialization and trade…

A: Option D is correct.  Option A is incorrect as gains from trade is based on comparative advantage…

Q: We can conclude that Spain has a comparative advantage in the production of chairs. [True or False]

A: Comparative advantage is focusing on the possibility of trade even though there is no absolute…

Q: Suppose that Canada can produce 100,000 hockey sticks or 10,000 gallons of maple syrup in a typical…

A: The businesses, and producers are considered to be the suppliers who makes up the supply side of the…

Q: If Canada can produce both cannabis and soybeans more efficiently, that is, with smaller absolute…

A: Cannabis is allowed in Canada for both recreational and therapeutic use. Medicinal cannabis use was…

Q: Comparative advantage is the... a. Gains from international trade. b. Ability of one region to…

A: Comparative advantage is the basis of goods and services traded in the international market.

Q: It has been shown that the US has comparative advantage in capital-intensive goods while China has…

A: The ability of an economy for producing a specified good or service at a lower cost of opportunity…

Q: You are an IMF official going to a country whose export earnings are not able to pay for imports.…

A: Import of goods and services to an economy from the rest of the world leads to outflow of funds from…

Q: China and Thailand jointly produce and efficiently trade tea and noodles. China has a comparative…

A: In the international market, when two countries make a trade transaction on the basis of comparative…

Q: The principle of comparative advantage states that countries should specialize in the production of…

A: International trade is the commercial transactions between countries that take place. Consumer…

Q: Q58 Suppose Spain is currently producing 90 units of wine and 10 units of cheese, but to produce 10…

A: Answer: To produce 10 more units of cheese Spain sacrifices 30 units of wine. So the opportunity…

Q: What is meant by the concept of "trade creation"? a. Increased exports and reduced imports as a…

A: In the international market, trade is the term used to explain an exchange of goods and services…

Q: terms of trade is the... a. Quantity of imports that must be purchased to sell a unit of exported…

A: The terms of trade can be defined as the ratio of a country's export price index and it's import…

Q: The gravity model of trade describes an exact physical relationship between trade, distance and size…

A: "The statement is FALSE."

Q: Question 3b- 5 Trade triangles of the partner and the home country in a two-country analysis are…

A: When talking about international trade, a trade triangle arises due to the opening up economies for…

Q: Trade between the United States and Honduras         is a losing proposal for the U.S. because…

A: Honduras is a Central American country with population of around 9.3 million people. Honduras and…

Q: Use the specific factor model to analyze a simplified version of a liberalization of trade between…

A: The price of coffee in Brazil will rise; previously, when Brazil was not trading, domestic producers…

Q: When a nation concentrates on a certain production activity based on a specific resource, which of…

A: The word "comparative advantage" refers to how trade benefits businesses, governments, and…

Q: International trade  Consider an H-0 economy in which there are two countries (US and France), two…

A: The Hecksher-Ohlin (HO) model proposes that when engaging in trade, nations with capital abundance…

Q: Happyland can produce 40 tones of marshmallows or 20 tones of chocolate in a year. Friendshipland…

A: The comparative advantage demonstrates the difference of opportunity cost for producing a commodity…

Q: Refer to Table 1-1 Which country has an absolute advantage in the production of bread? Group…

A: Absolute advantage refers to an individual's, company's, region's, or country's capacity to create a…

Q: Suppose the US is relatively well endowed with skilled workers and Mexico is relatively well endowed…

A: Suppose the US is relatively well endowed with skilled workers and Mexico is relatively well endowed…

Q: Assume the production of chocolate is capital-intensive and the production of fruit is…

A: Comparative advantage is an economy's ability to produce a good or service at a lower opportunity…

Q: Q.1.1 Consider the information contained in the table below. The table shows output rates in France…

A: The Correct answer is 'A' i.e., Holland should specialise in wine production and should export wine…

Q: Q39 According to the Heckscher-Ohlin theory, national comparative advantages exist because of...…

A: Hecksher-Ohlin model is an economic theory especially in international trade that states that…

Q: President Trump is currently getting tough on trade. This means he wants terms of trade so that…

A: When service is produced, fixed and variable cost  takes place and process of business follow ups.…

Q: Maldonia has a comparative advantage in the production of while Lamponia has a comparative advantage…

A: Introduction: The potential benefits that an individual, investor, or organization loses out on by…

Q: The United States has an absolute advantage in producing sugar over all of the other sugar producing…

A: Relative to all other sugar producing countries, the US has absolute superiority in sugar…

Q: Comparative Advantage The theory of Comparative Advantage emphasizes gains that countries can…

A: Since the globalisation has been set up, all the countries are focusing on the ways to step into the…

Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.