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. How A Central Bank Fixes the Exchange Rate? Answer: The Central bank should always be willing to trade currencies at the fixed exchange rate with the private actors in the f
Explain the Financial Revolution and Monetary Affairs
Q. What are the predictions for the long run of the Monetary Approach? Answer: Money supplies- Known the equations E $/E = P US /P E P US = M S US /L(R $
Compare and contrast China's newest economic regions: the Special Economic Zones (SEZs), Open Cities, and Open Coastal Areas. What is the purpose of each regional type? Show how e
part of the return on the investment comes from the asset itself and part from the currency of the foreign currency. agree or disagree?
Calculate the doublefactoral terms of trade (TD), formulated by Jacob Viner based on following information: Suppose in the base year of 2015, Px= 100, Pm= 100, Zx= 100, Zm= 100and
Explain the Partial Globalization of International Finance
Q. "A monetary policy is not a policy tool under fixed exchange rates." Discuss. Answer: It is True Under fixed exchange rates domestic asset transactions by the centr
Application of defferential calculus in economics
Q. The United States, as it began its long and unbeaten growth in the early 19th Century, consciously promoted domestic production through such activities as tariffs, Clay's Ameri
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: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd