Aalbania enjoy a comparative advantage, Managerial Economics

205_33.png

Refer to above figure. Albania refused to engage in international trade for ideological reasons. To maximize its economic welfare it would choose to produce at which point in the diagram above? Assume the PA/PB at point a was equal to 1. Given this information, in which good (A or B) does Albania enjoy a comparative advantage?

Now that the Cold War is over, Albania is interested in obtaining economic welfare gains from trade. The relevant international relative price is PA/PB = 2. Albania would thus choose to produce at which point (a, b, or c)? Given this additional information, in which good does Albania enjoy a comparative advantage?

 

Posted Date: 3/15/2013 2:44:12 AM | Location : United States







Related Discussions:- Aalbania enjoy a comparative advantage, Assignment Help, Ask Question on Aalbania enjoy a comparative advantage, Get Answer, Expert's Help, Aalbania enjoy a comparative advantage Discussions

Write discussion on Aalbania enjoy a comparative advantage
Your posts are moderated
Related Questions
Determine The scope of managerial economics The scope of managerial economics involves following subjects: 1.  Theory of demand 2.  Theory of production 3.  Theory of

What market type does the company you work for operate under? What makes you think this? Do you think that this is the right market type for your company to operate in? Explain you

What is Normative economics It is concerned with varied corrective measures which a management undertakes under different circumstances. It deals with goaldevelopment, goal det

Q. Explain about Frequency domain? Frequency domain:   Frequency domain is a term which is used to elucidate the domain for analysis of mathematical signals or functions with

Structural Unemployment The decline of the highly localized industry due to international trade causes great problems of regional (structural) unemployment.  If it would take

Given a saving function of S = -25 + .2Yd, a $10 billion enhance in government spending will bring about how many dollars of change in consumption?

A firm's technology needsit to combine 5 person-hours of labor with 3 machine-hours to make 1 unit of output. The firm has 15 machines in place and the wage rate rises from $10 per

POPULATION SIZE AND DEMOGRAPHIC TRENDS a.      Changes in Population The people of a country are its consumers.  They provide the labour force for production.  A study of

Supply and Demand Discuss and analyze following statement: The Wall Street Journal reported that recent law school graduates were having a very difficult time obtaining jo

Ask questiHow does economic theory contribute to managerial decisions? on #Minimum 100 words accepted#