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Q. Why is the H.O. model called the factor-proportion theory?
Answer: The H.O. model survey the limitations and the nature of presumptuous that the sole determinant of comparative advantage is inter-country differences in (relative) factor proportions.
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. D
Suppose that industry 1 is monopolistically competitive, with a CES sub-utility function: U(c1,c2 ) = c1? + c?2 , 0 We let the marginal costs be denoted by c1(w,r), and the fixe
diagram
Role of foreign trade to the economic development?
Q . Is it possible that if positive scale economies characterize an industry, that its equilibrium can be consistent with purely competitive conditions? Explain how this would hap
Q. A naïve implication of the DD - AA framework is that either fiscal or monetary policy can lead to full employment. Discuss why this view is naïve. Answer: 1. Inflation m
ABOUT THIS THEORY
Using examples, from the government, illustrate the significant opportunity cost.
How much Debate over the MNC and the Nations State
what does the law of reciprocal states about and how does it differ from the theories of smith and ricardo
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