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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 product 2. Therefore a fall in the comparative price of 1 will lower the demand for labour and will result in a decrease in the wage rate.
explain -haberler theorem
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what are the limitation of comparative advantage?
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How to derive offer curve and its difference from reciprocal demand curve
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