The life-cycle model explains comparative advantage as follows: a. at the invention stage, the product is more capital-intensive b. at the invention stage, the product is more materials intensive. c. at the invention stage the product is more labor-intensive, while at the maturity stage the product is more capital intensive d. None of the above
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The life-cycle model explains
| a. |
at the invention stage, the product is more capital-intensive |
|
| b. |
at the invention stage, the product is more materials intensive. |
|
| c. |
at the invention stage the product is more labor-intensive, while at the maturity stage the product is more capital intensive |
|
| d. |
None of the above |
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- Standard trade Model When comparing the agricultural sectors of the USA and the UK, we can analyze it within the framework of the standard trade model, also known as the neoclassical trade model. This model assumes perfect competition, constant returns to scale, and comparative advantage based on differences in factor endowments. Here's how the standard model can be applied to the agricultural sectors of the USA and the UK: a) Land: The USA has vast amounts of arable land, which can be used for agriculture. Its large land endowment can give it a comparative advantage in the production of various agricultural commodities. b) Labor: The UK's agricultural sector might not have a significant comparative advantage in labor-intensive agriculture due to relatively high labor costs compared to countries with lower wage levels. However, it may focus on niche agricultural products or high-value crops that require specialized labor or have specific geographical advantages. c) Capital: The…Assume our standard model. In any hour, Andreas can knit 5 scarves or 2 hats. In any hour, Katya can knit 6 scarves or 1 hats. What is the opportunity cost of knitting 100 hats (in terms of number of scarves) for the person with the comparative advantage in scarf production? Note: If neither has a comparative advantage, then we can say that both has a comparative advantage.Assume our standard model. Andreas can knit 4 scarves per hour and 3 hats per hour. Katya can knit 12 scarves per hour and 6 hats per hour. What is the opportunity cost of one scarf (in terms of number of hats) for the person with the comparative advantage in scarf production?
- 22. A critical element of the Heckscher-Ohlin model is that a. Different goods display different factor intensities in their production. b. Some countries have no comparative advantage in anything. c. Trade may not be beneficial. d. Some countries have no absolute advantage in anything.In the specific model with two consumption goods and labour (mobile) and land and capital (specific factors), in Home in the market equilibrium with free international trade of goods (compared to autarky).Which statements are correct? 1.the economy does not achieve a Pareto improvement. 2.the profit of the capital owners increases. 3.a good that is exported cannot have a higher price. 4.consumption is strictly higher. 5.the price for land cannot be lower. 6.workers will be better off if they consumption demand is sufficiently biased toward imported goods. 7.the real wage will be higherUse the technology choice model in to show the effect of the discovery of the Atlantic Trade (AT) route on the direction of technological change in an economy such as Britain?
- Which of the following statements is incorrect regarding the PPF model? a. A decrease in resource availability would cause the PPF to shift in closer to the origin. b. Points that are currently outside of the PPF could be attainable with increased resource availability and/or improved technology. c. The points on the PPF where the curve touches the axes are clearly the best ones for the firm to produce. d. If the goods sector of an economy is being studied, the axes will be labeled consumer (or consumption) goods and capital goods. e. If an entire economy is being studied, the axes will be labeled goods and services.3. It has been argued that the Heckscher-Ohlin model defines comparative advantage as the outcome of variances in countries':a. Degree of technological sophisticationb. Relative richness of resourcesc. Labor costsd. Important production activitiesIn the Heckscher-Ohlin model the factor that a country is abundant in will gain from trade, i.e. its income will increase. True False
- According to the Ricardian Model, if two nations have the same opportunity cost for cars, then they BOTH Group of answer choices cannot gain from trade in cars. They cannot both gain. Only one of them can gain at a time. still gain from trade in cars. can only gain from trade in cars if one of them reduces its wages.Explain, with a two-country, two-good model, why the Heckscher-Ohlin model predicts only partial specialisation in the production of two goods, while Ricardo's comparative advantage model predicts full specialisation when opening up to international trade. You can opt to present your explanation with the aid of diagrams.Assume that Trinbago is a small country that produces wine and motor vehicles, where motor vehicles are capital-intensive. Trinbago is also capital intensive, and the standard Heckscher -Ohlin (H-O) assumptions hold. The other country in the model is Vincyland. Questions: Give a short background on the Heckscher-Ohlin Trade model and then answer the following questions. (d) Show the necessary graphs to fully explain all requested effects. Ensure to label graphs and give brief explanations. (e) Given that Vincyland is a small country, examine the partial equilibrium welfare effects associated with imposing a tariff on their import good given that the prediction of the imported good yields a positive externality.Should a subsidy have given a more desirable solution? Please explain