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The Heckscher-Ohlin model assumes that tastes are the same in Home and Foreign. Suppose now that tastes are different in Home and Foreign. Is it possible for the capital intensive country to now import the capital intensive good? Briefly discuss the intuition, and then illustrate your answer using the PPF-indifference curve diagrams for Home and Foreign.
We continue to assume that Home is capital abundant and Foreign is labor abundant. They produce computers and shoes. Computers are capital intensive and shoes are labor intensive.
How much does the gross price increase in each market
What will be the effect of this change in policy on both the real and the nominal interest rate in the long - run?
A firm uses two inputs, unskilled labor (L) and capital (K) to produce its product. The wage rate for one unit of labor is $5, while units of capital cost $20.
A tariff I ssimply a tax on imports. Use our model of the excise tax (with diagram) to expain why domistic firms request that tariff? Consider both the domestic and the foreign country in your answer
You are a member of the City Council of Mid ville , California, a town of 10,000 residents, comprised primarily of 'middle-class' blue-collar laborers.
Using the exchange rates and prices in the tables above:
Use Excel program to estimate of the state's demand for KBC microbrews in Ohio. Print (past) the computer regression output and provide an economic interpretation of the regression results.
Explain what accounts for the Hong Kong Monetary Authority behaving differently than the other central banks in emerging Asia.
Suppose that a chair manufacturer is producing in the short run (with its existing plant and equipment). The manufacturer has observed the following levels of production corresponding to different numbers of workers:
Taxi fares in New York recently were increased by nearly 50%. Predict the effect on the price of taxicab medallions, the earnings of taxicab drivers and congestion in New York streets.
Say if the following statement is true or false and why-Exports depend only on the demand of foreign countries for our products and therefore our exporting
If you can borrow (and lend) money at an interest rate of 8 percent, will the investment be a profitable undertaking? Is the project profitable at an interest rate of 12 per cent? Provide numerical calculations in support of your answers.
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