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Q. Countries that are willing to tolerate an unusually high quantity of pollution relative to their supplies of other factors would leads to export "pollution-intensive" goods. Discuss using the Hechscher-Ohlin (H.O.) model.
Answer: This statement is deficiently crafted. It appears to imply that pollution per say is a proper factor of production. Namely, just like if you add a worker, you obtain additional product, thus the marginal product of pollution is positive. The trouble here is that pollution isn't really a factor of production, but somewhat an externality, which may perhaps be more typical of imported goods than exported ones. In such a case that, the above statement is false.
Q. Suppose Airbus is set to give the aircraft before Boeing. Which company will enter the market? Answer: Boeing will not and Airbus will produce.
Q. Based on the case study, answer the following question: Can currency boards make fixed exchange rates credible? Answer: No for the reason that is prohibited by law from a
HOW TERMS OF TRADE IS DETERMINED
INTERNATIONAL FINANCE International finance is concerned with the mobility of financial capital across the countries, and the problems and opportunities this mobility p
Criticism against Hechscher-Ohlin type trade theories is explained below: The foremost criticism leveled against Hechscher-Ohlin type trade theories are that they views compara
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