Suppose a country experiences an inflow of labor from the rest of the world but the world relative price remains the same. In that country, output of the capital - intensive good will. and output of the labor-intensive good will.

true/false explain If an advanced country has an absolute advantage in the production of everything (relative to certain less developed countries), the advanced country will benefit if it eliminates trade with less developed countries and becomes self-sufficient.

Look at a country’s Terms of Trade (T.O.T.). It is assumed that when the T.O.T. value increases the country’s wellbeing goes up, and when the T.O.T. value declines, the country’s wellbeing is reduced. Do you agree??? Explain!!!

Now suppose that if Zimbabwe uses all of its resources, it can produce 50,000 tons of metal ores or 100,000 delivery trucks (trading off at a constant rate).  Suppose that if South Africa uses all of its resources, it can produce 20,000 tons of metal ores or 80,000 delivery trucks (trading off at a constant rate).  What is the direction of trade (who exports what to whom)?  Be sure to give the opportunity costs of production of both goods for both countries. What is one potential price of metal ores in terms of trucks at which both Zimbabwe and South Africa would benefit from trade?  Rank the autarkic prices and the world price of metal ores from lowest to highest.

A German worker takes 600 hours to produce a car and 3 hours to produce a case of wine. A French worker takes X hours to produce a car and 4 hours to produce a case of wine. For what values of X will gains from trade be possible? Check all that apply. 3 800 = 820 900 For what values of X will Germany export cars and import wine? Check all that apply. 1 820 950

What is opportunity cost of  a T-shirt in Mexico? Show all your calculations. What is opportunity cost of a T-shirt in Egypt? Show all your calculations. Which country has comparative advantage in production of T-shirts?  How do you know? Explain your answer.

What is likely to happen to wages in the capital-abundant country after it trades with the other nation? Will your answer change if capital were immobile in the nation?