Reference no: EM131386105
Please use your own words.
Suppose two countries, Canada and Mexico, produce two goods: timber and televisions. Assume that land is specific to timber, capital is specific to televisions, and labor is free to move between the two industries. When Canada and Mexico engage in free trade, the relative price of televisions falls in Canada and the relative price of timber falls in Mexico.
a. Using a 'Bucket' diagram like the ones used in class, show how labor in Canada is initially allocated between the timber and television industries. Then, show how the wage changes in Canada due to a fall in the price of televisions, holding constant the price of timber. Can we predict that change in real wages?
b. What is the impact of opening trade on the rental rates for capital and land in Canada? Can we predict that change in the real rental rates for capital and land?
c. What is the impact of opening trade on the rental rates for capital and land in Mexico? Can we predict that change in the real rental rates for capital and land?
d. In each country, has the specific factor in the export industry gained or lost? Has the specific factor in the import industry gained or lost?
Probability that he receives at least one of the purple cars
: The purchasing agent for a municipality has contracted with a local car dealer to purchase four cars. The dealer has 25 cars on his lot; 10 red, 7 blue, 6 white, and 2 purple. If the purchasing agent has no control over the colors he receives, wha..
|
Which of the following statements concerning bonds
: The DEF Company is planning a $64 million expansion. The expansion is to be financed by selling $25.6 million in new debt and $38.4 million in new common stock. The before-tax required rate of return on debt is 9 percent and the required rate of r..
|
Organization is preparing to outsource and staff
: When an organization is preparing to outsource and staff may/could lose their positions, what do you think is their biggest need from the organization?
|
Discuss which company you would choose to invest in
: As an investor, discuss which company you would choose to invest in and provide a rationale for your decision. Support your conclusions, why or why not?
|
Holding constant the price of timber
: Using a 'Bucket' diagram like the ones used in class, show how labor in Canada is initially allocated between the timber and television industries. Then, show how the wage changes in Canada due to a fall in the price of televisions, holding consta..
|
Comparing two separate pricing schemes
: A public water utility is comparing two separate pricing schemes: (i) a two-tiered pricing scheme where the first 5,000 gallons cost $20 and all subsequent gallons cost $10 or (ii) a single price of $15 per gallon.
|
Determine the current equilibrium price and quantity
: A water utility for a growing city is considering expanding their capacity by investing in a larger system of wells. Their long-run marginal cost of water provision is characterized by the function MC(q) = 5 + (2/3)(q) (q is in thousands of gallons)...
|
Identify an implicit assumption
: Identify an implicit assumption that is part of this argument. Change that assumption and argue to a new conclusion.
|
Relationship between process design and facility layout
: Topic: Citing specific examples, critically discuss the relationship between process design and facility layout. 1000 words needed in one week. Will provide the reading and reference materials as well. Your assignment answer must be grounded in an ..
|