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After the North American Free Trade Agreement (NAFTA) was signed, trade restrictions between Canada, the United States, and Mexico were eased and cross-border trade increased. What predictions would the Heckscher-Ohlin model make concerning the changes in labor-intensive industries such as textiles in both Mexico and the United States and in capital-intensive industries such as steel in both Mexico and the United States, as a result of NAFTA? Explain:
Suppose low-income people have preferences for non-food consumption (NF) and for food consumption (F). In the absence of any income transfer programs, a person's budget constraint is given by NF + PFF = I where PFF is the price of food relative to no..
Your company is interested in analyzing the behavior of interest rates and the models used to predict interest rates in the future. As an initial project in this area, If the market-clearing price (market equilibrium) of this bond has a return of 20%..
During the past year, gasoline prices have been very volatile. One reason given for at least some of the volatility is the threat of war between Israel and Iran. More recently, there has been a report of serious fire damage to Venezuela's largest ref..
Suzette Crepe orders pancakes at her local IHOP every morning. When pancakes cost $1.20 per stack, she buys 6 stacks. When the price/stack is $1.80, she buys 5. Microwaveable pancakes become available at Suzette’s grocery store. Will her demand for I..
The demand for goods varies based on the change in the price of the goods. For example, if oatmeal costs less than cereal, consumers would buy more oatmeal for breakfast. However, the demand for inexpensive goods and services is not significantly aff..
What is the future value of $1,000 payable five years from now, and the effective interest rate, i_eff, at a nominal interest rate of 12% per year compounded. Explain in one or two sentences why you get higher future values as you move from a) throug..
The numbers on this spectrum represent the number of voters lying to the left of the number.
Calculate the substitution and income effect for the utility function: u(x,y) = x + lny and show that the Slutsky equation applies to those cases.
Might a job retraining program be a more useful policy to address structural unemployment than to address frictional unemployment? Explain with the help of a graph how the minimum wage might cause unemployment; Explain with the help of a graph how th..
Calculation of the unemployment rate and part time workers who would prefer to work full time.
Assume no change in current productivity or current labor supply in either country. What is happening to financial flows.
Provide an example of income effect and substitution effect in regards to supply of labour. Illustrate what is opportunity cost of work in this case
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