Why do economists typically view trade as beneficial to all countries involved? Explain what are the gains to trade. Are all individuals within a country better off as a result of trade with other countries? Explain your reasoning.
Why do economists typically view trade as beneficial to all countries involved? Explain what are the gains to trade. Are all individuals within a country better off as a result of trade with other countries? Explain your reasoning.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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International
a) Why do economists typically view trade as beneficial to all countries involved? Explain what are the gains to trade. Are all individuals within a country better off as a result
of trade with other countries? Explain your reasoning.
b) Consider a country that adopts a fixed exchange rate regime. What are the potential benefits
of adopting a fixed exchange rate regime? What are the potential costs of adopting a fixed
exchange rate regime?
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Step 1: Define International trade
VIEWStep 2: (a) (i) Explain the benefits of international trade
VIEWStep 3: (a) (ii) Identify the gains of the individuals from the trade
VIEWStep 4: (b) (i) Benefits of a fixed exchange rate regime
VIEWStep 5: (b) (ii) Cost of a fixed exchange rate regime
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