EBK INTERNATIONAL ECONOMICS
7th Edition
ISBN: 9780134523873
Author: Gerber
Publisher: YUZU
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Question
Chapter 4, Problem 2SQ
a)
To determine
Identify the capital and labor-intensive goods among bread and steel.
b)
To determine
Identify the bread exporting country.
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Students have asked these similar questions
Suppose that Brazil is capital abundant and Chile is natural resource abundant. If timber is natural resource-intensive and computers are capital intensive, then after trade begins between Brazil and Chile, which of the following statements is true?
a) It is impossible to determine which owners will gain in each country.
b) The incomes of the owners of natural resources are likely to fall in Chile.
c) The incomes of the owners of capital are likely to fall in Brazil.
d) The incomes of the owners of capital are likely to rise in Brazil.
"Accoring to Ricardo's analysis, a country exports any good whose production requires fewer labor hours per unit than the labor hours per unit needed to produce the good in the foreign country. That is, the country exports any good in which its labor producivity is higher than the labor productivity for this good in the foreign country." Do you agree or disagree? why?
What is the cost ratio of capital goods to consumer goods in Germany? What is the cost ratio of capital goods to consumer goods in France?
Solve for a terms of trade ratio that will be mutually beneficial for both nations so that they will want to engage in trade with one another.
Chapter 4 Solutions
EBK INTERNATIONAL ECONOMICS
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