Reference no: EM131076854
Assignment: International trade movement of factor
1. Agriculture products (A) are produced with land and labor, and manufacturing products (M) are produced using capital and labor. Labor is perfectly mobile between industries but cannot move internationally.
(a) Suppose there are two countries, Home and Foreign that are identical except that Home has a larger endowment of labor than Foreign. The two countries are engaged in free trade. Given this scenario, is there any motive for capital to move internationally? If so, which direction would it move?
Hint: what is the marginal product of capital in Home and Foreign.
(b) Assume that the international prices of A and M do not change and that capital moves from Foreign to Home. What will FDI do to Home's level of production of M and of A? Show using the following diagram.
(c) What is the impact of this inward FDI on the real wage of labor, the real rental of capital, and the real rental of land in Home?
(d) How does the outward investment affect the real earnings of labor in Foreign?
2. There are two countries, Home and Foreign. The two countries are identical except that Home has a labor force of 100 and Foreign has a labor force of 200. Given this allocation of labor across Home and Foreign, the value of the marginal product of labor in Home is 30 and the value of the marginal product of labor in Foreign is 20. If labor were to be free to move, the wage in both countries would be 25.
(a) If immigration were free between countries, how much would the value of output change in Home?
(b) What is Home's national gain in allowing immigration?
Hint: calculate the area of the correct triangle.
(c) Who benefits from this immigration in Home and how much?
|
Write a program to display the running time of the sorts
: Arrays of the same size should contain identical entries. Use the function clock from to time each sort. See the beginning of the programming problems in Chapter 10 for an example of how to time code.
|
|
How are malignant tumors different from benign tumors
: A certified family nurse practitioner with an MSN degree in family practice who works in a clinic serving patients who have connective tissue disorders refers to himself as a clinical geneticist. Is this title appropriate?
|
|
Rate of heat loss in watts due to process
: Even if a man shows no visible perspiration he still evaporates about 500 grams of water per day from his lungs. How many calories of heat are removed by this evaporation? What is the rate of heat loss in watts due to this process?
|
|
What is the order of the bucket sort
: What is the order of the bucket sort? Why is the bucket sort not useful as a general sorting algorithm?
|
|
What is impact of this inward fdi on the real wage of labor
: What is the impact of this inward FDI on the real wage of labor, the real rental of capital, and the real rental of land in Home? How does the outward investment affect the real earnings of labor in Foreign?
|
|
Power of the cicada sound source
: Estimate how far away a cicada can be heard if the lowest possible audible intensity of a sound it produces is 9 × 10^-10 W/m2 and the power of the cicada's sound source is 3 × 10^-6 W.
|
|
Calculate the current flowing in the conductor
: (a) Determine the required value of the shunt resistance if the maximum value of the current / is 200 A. The meter can read a maximum of 1 mA and has a resistance of 0.1 11.
|
|
Find one of evidence showing that nature makes contribution
: Try to choose evidence that has not been previously discussed by one of your classmates. Describe each of these pieces of evidence and explain why it supports the influence of either nature or nurture, as appropriate. What is the practical importa..
|
|
Minimum pulling force
: He pulls vertically downward on a rope that passes around three pulleys and is tied around his feet. What is the minimum pulling force that the clown must exert to yank his feet out from under himself?
|