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Main Objective of the assessment
The objective of this assignment is to assess students' knowledge of key theories of international trade and investment and their applicability to modern day world.
Part 1
Choose a theory of trade based on comparative advantage and a theory of trade based on economies of scale, and critically compare them in terms of how well they: a) answer the key questions of international trade; and b) reconcile with empirical evidence on international trade.
Part 2
Explain why despite enormous natural resources, much of developing countries' population remains in poverty and the region has been repeatedly experiencing financial crises. Examine how developing countries could adopt foreign exchange interventions to grow their economies.
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