User Account

All Pages

Extent of trade creation-trade diversion-laos and vietnam

Assignment Help Macroeconomics
Reference no: EM133062790

Problem: Laos and Vietnam are trade partners of Korea. Korea imposes a tariff of $20 on both countries. Korea concluded a Free Trade Agreement with Vietnam in 2015, eliminating tariff on imports only from Vietnam. Let import price from Laos be PL = $40, import price from Vietnam, PV = $50, and the tariff t = $20. Suppose q1 = 10, q2 = 20, q3 = 60 and q4 = 70.

a) After FTA, who loses and gains in Korea? By how much?

b) What is the extent of trade creation and trade diversion? Which effect is greater?

c) Who gains and loses in Vietnam?

d) Is it a good idea for Korea to have concluded this FTA with Vietnam?

849_Imports After FTA.jpg

Reference no: EM133062790

Questions Cloud

Calculate total amount to be reported for ending inventory : Creative Technology reports inventory using the lower of cost and net realizable value (NRV). Calculate total amount to be reported for ending inventory
Calculate ending inventory and cost of goods sold for year : During the year, Wright Company sells 400 remote-control airplanes for $100 each. Calculate ending inventory and cost of goods sold for year
Calculate cost of goods sold : Question - Swifty Corporation is a multi-product firm. Calculate cost of goods sold, assuming Swifty uses a periodic inventory system and weighted average cost
What is the MIRR of this project : The Gulf Co. is evaluating a project with the following cash flows: The company uses a 15 percent interest rate on all of its projects. What is the MIRR
Extent of trade creation-trade diversion-laos and vietnam : Problem: Laos and Vietnam are trade partners of Korea. Korea imposes a tariff of $20 on both countries. Korea concluded a Free Trade Agreement with Vietnam in 2
Compute approximate internal rate of return of each project : Compute the approximate internal rate of return of each project. Which one should be adopted based on the internal rate of return approach
What is the risk and return of a portfolio : Problem: Maria Makeba, CFA wants to construct a portfolio which includes government securities and equity exposure. She intends to use Treasury bills and an ind
What is wilson de ratio : Problem: Wilson Inc. uses bonds and common shares to finance its investments and operations. The firm's debt consists of 20,000 bonds that are currently trading
What is the company non-operating return : The 2018 balance sheet of The New York Times Company shows net operating profit margin (NOPM) of 11.5%, What is the company non-operating return

Reviews

Write a Review

Macroeconomics Questions & Answers

  Inflation targeting be a good policy

Why might it be difficult for the Fed to formally adopt inflation targeting?  Would inflation targeting be a good policy for the Fed in the present economic environment

  In using the taylor rule

In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?

  Describe the present economic crisis situation in europe

Describe the present economic crisis situation in Europe.  Why has it been so difficult for the Europeans to find a solution to this problem?   Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..

  Long-term federal government budget problems

Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.

  Derive and compare demand curve

Question based on Derive and compare demand curve,  Derive Ambrose's demand function for peanuts. How does it compare with Johnny's demand curve for peanuts?

  Problem based on utility function

Problem based on  Utility Function - Problem,  Answer and explain the following using a diagram which is completely labeled.

  Laffer curve : tax rate and tax revenue

Question based on Laffer Curve : Tax Rate and Tax Revenue,  Do raising tax rates necessarily raise tax revenue? What factors affect how tax revenue changes when tax rates change?

  Problem - income elasticity of demand

Problem - Income Elasticity of Demand,  Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5

  Positive balance of payment

Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."

  Effect of recession on the investment curve

Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.

  Affect of falling domestic investment on trade surplus and

How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.

  Crises in the banking sector and bank run

Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd