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Q. Explain how an increase in government spending would affect the DD-AA schedule in the short run.
Answer: A raise in government spending will raise aggregate demand, which will shift the DD to the right. If AA leftovers unchanged the new equilibrium will be at a higher Y and lower E. Ever since E is the nominal exchange rate a lower E is an appreciation of the currency.
Q. If a scale economy is the dominant technological factor establishing or defining comparative advantage, then the underlying facts explaining why a particular country dominates
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
essay should be based on one of the problems mentioned into Haberler (1950) with references to the main assumptions of the general equilibrium analysis
International relations (IR) is the study of relationships among countries, including the roles of states, inter-governmental organizations (IGOs), international nongovernmental or
What does the factor proportions theory posits
Q. One reason international trade has a powerful effect on the distribution of income within countries is that some factors are "specific", and therefore cannot move costlessly fr
INTERNATIONAL TRADE can be understood as follows By the international trade, we signify the exchange of goods and services between different countries. For any individual count
Q. Explain why the dollar of the United States became the postwar world's key currency. Answer: 1. The untimely convertibility of the U.S dollar in 1945. 2.
Q. What is the interest parity condition? Answer: The circumstance that the expected returns on deposits of any two currencies are equal when measured in the same currency is
how to learn trade model
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