Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
The Concept of Comparative Advantage is explained below:
To illustrate the concept of the comparative advantage, we take the instance of two equi-sized equi-endowment countries, which are US and UK. US produces 40 and 60 units of cotton and food p.a. respectively (using all available resources), while the UK produces 30 and 20 units of cotton and food p.a. respectively (using all the available resources). Clearly, the US has complete advantage in the production of both cotton and food. By absolute advantage it is meant that the US is more efficient at producing food and cotton both than the UK. But, upon computing the opportunity costs of producing cotton and food in the either country, is revealed that the opportunity cost of producing one unit of the cotton in the US is 1.5 units of food, while the opportunity cost of producing one unit of food in the US is 0.67 units of cotton. Similarly the opportunity cost of producing one unit of the cotton in the UK is 0.67 units of food, whereas the opportunity cost of producing one unit of food in the UK is 1.5 units of cotton. Hence, the US has a lower opportunity cost (comparative advantage) in production of food while the UK has a lower opportunity cost (comparative advantage) in production of cotton. By specializing in the goods/commodities they have comparative advantage in and then trading between them, both the countries can improve their consumption possibilities beyond those implied by autarky (that is a situation of no trade where the PPF and CPF are the same).
Q. Explain why the FDIC is following a "too-big-to-fail" policy of fully protecting all depositors at the largest banks. Answer: It is a tricky question the FDIC does that even
Q. Use the II - XX framework in order to show graphically how inflation can be imported from abroad unless exchange rates are adjusted. Answer: Suppose that the home economy is
Q. The effective rate of protection is a weighted average of nominal tariffs and tariffs on imported inputs. It has been noted that in most industrialized countries, the nomina
Q. How did countries use their policy tools to regain internal and external balance after the first oil shock of 1973? Answer: Seeing that the recession deepened over 1974 an
Using 4 different figures, plot the time paths showing the effects of a permanent increase in the United States money supply on: A. U.S. money supply. B.
# ???? ..
Q. How did the European single currency evolve? Answer: The answer is related to the crumple of Bretton Woods and the European Currency reform of 1969-1978. The Werner
what is world trade
defination, types
Q. Why do governments prefer to avoid excessive current account surpluses? Or, why are growing domestic claims to foreign wealth ever a problem? Answer: On behalf of a given l
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd