Question 1   Which of the following is NOT a result of specialization?   Multiple Choice   Increased productivity   Innovation   Higher transaction costs   Increased trade

1) What are the key differences between the theory of multinational enterprises and conventional trade theory?

5) Ricardo's simplified trade model is based on all of the assumptions except a. costs do not vary with the level of production b. the level of technology is fixed for all nations c. perfect competition prevails in all markets d. capital is the only factor of production 5

explains that specialization and trade makes people (and the world) better off.  Please explain this in your own words and give one example each, one from the film and one of your own that helps clarify the importance of specialization and trade as key underpinnings of successful economic systems.

The World Trade Organization   A. was established to settle trade disputes within the European Union.   B. increases world trade by providing interest rate subsidies to foreign borrowers who buy U.S. exports on credit.   C. is another name for the IMF.   D. was established to resolve disputes arising under world trade rules.

If a country closes off to trade and notices that the number of firms in an industry doubles in size, what economic theory would help us explain this phenomenon? A. Stolper-Samuelson. B. Melitz. C. Ricardian. D. Cournot.