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Q. Using an equation, explain why governments prefer to avoid excessive current account surpluses.
Answer: This pursue from the national income identity S = CA + I which says that total domestic savings S is divided among foreign asset accumulation CA and domestic investment I.
Q.. "A good cannot be both land- and labor-intensive." Discuss. Answer: In a two good or two factor models for instance the original Heckscher-Ohlin framework and the factor
Q. What are the three types of transactions between the residents of different countries? Answer: 1. Trades of services and goods for goods or services. 2
what is scope of international economics
What are the predictions for the long run of the Monetary Approach? Answer: Money supplies- Known the equations
Q. What are the factors affecting the demand for foreign currency? Answer: Three factors that affect the demand for foreign currency are risk, expected return, and liquidity.
who promotes globelization
Q. Explain why even owners of capital that cannot be moved can avoid more of the economic stability loss due to fixed exchange rates when Norway's economy is open to capital flows
In the Ricardian analysis, why does each trading partner have an incentive to produce at an endpoint of its production-possibility frontier? Why are prices of factors of production
Habrrler''s oppirtunity cost theory
Q. Explain how an increase in government spending would affect the DD-AA schedule in the short run. Answer: A raise in government spending will raise aggregate demand, which wi
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