What political factors contributed to the formation of the European Union? ○ A) The disparity of wealth among European countries and communist countries and geographical dispersion The strength of the Soviet Union and the weakness of independent European nations B) ○ D) World War II devastation of Western Europe and desired political and economic strength for the region The desire of European leaders to compete against the Soviet Union and the United States and the desire to protect European culture

You just overheard your friend say the following: Poor countries like Malawi have no absolute advantages. They have poor soil, low investments in formal education and hence low-skill workers, no capital, and no natural resources to speak of. Because they have no advantage, they cannot benefit from trade. How would you respond?

If trade increases world GDP by 1 per year, what is the global impact of this increase over 10 years? How does this increase compare to the annual GDP of a country like Sri Lanka? Discuss. Hint To answer this question, here are steps you may want to consider. Go to the World Development Indicators (online) published by the World Bank. Find the current level of World GDP in constant international dollars. Also, find the GDP of Sri Lanka in constant international dollars. Once you have these two numbers, compute the amount the additional increase in global incomes due to trade and compare that number to Sri Lankas GDP.

Why might Belgium, France, Italy, and Sweden have a higher export to GDP ratio than the United States?