In the specific model with two consumption goods and labour (mobile) and land and capital (specific factors), in Home in the market equilibrium with free international trade of goods (compared to autarky).Which statements are correct? 1.the economy does not achieve a Pareto improvement. 2.the profit of the capital owners increases. 3.a good that is exported cannot have a higher price. 4.consumption is strictly higher. 5.the price for land cannot be lower. 6.workers will be better off if they consumption demand is sufficiently biased toward imported goods. 7.the real wage will be higher

In the specific model with two consumption goods and labour (mobile) and land and capital (specific factors), in Home in the market equilibrium with free international trade of goods (compared to autarky).Which statements are correct? 1.the economy does not achieve a Pareto improvement. 2.the profit of the capital owners increases. 3.a good that is exported cannot have a higher price. 4.consumption is strictly higher. 5.the price for land cannot be lower. 6.workers will be better off if they consumption demand is sufficiently biased toward imported goods. 7.the real wage will be higher

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter19: International Trade

Section: Chapter Questions

Problem 12PAE

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