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Q. Calculate the effects of the fall in the relative price of good 2 on the income of the specific factors capital and land. Answer: For the reason that good 2 uses land, a f
what are the theories supporting protectionism
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Q. Using the GG - LL framework, analyze the effect of an increase in the size and frequency of sudden shifts in the demand for a country's exports. Answer: Such a alter pus
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
Q. What is the purpose of the following figure? Answer: The use of the figure is to show the inflation convergence within the six original EMS members. The f
Q. Suppose the relative price of good 1 falls relative to the price of. What happens to the wage rate? Answer: The labour component of the price of 1 is bigger than that of p
Q. Why do governments prefer to avoid current account deficits that are too large? Answer: A current account debit may possibly pose no problem if the borrowed funds
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