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Problem 1:
(a) Clearly distinguish between the theories of Comparative and Absolute advantage of trade (you are expected to use examples to illustrate your answer).
(b) According to you, how far do these theories still illustrate the behavior of trade around the world? What other theory/theories come closer to explaining the pattern of current world trade behavior?
Problem 2:
a) Describe, with the use of diagrams, the difference between a tariff and a quota.
b) Over the recent years, domestic support in agricultural trade has become a significant issue in international trade negotiations. Explain how subsidies in agricultural trade is trade-distorting.
Draw a Supply or Demand Diagram A) Suppose that several months of data showed the CPI increasing at a 4.5% annual rate due largely to increases in the price of energy and food
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Consider Fig 13-11. 1000 tons/day of moist MSW are processed to yield 700 tpd of RDF product. Raw MSW heat value is 5,000 btu/lb. RDF is 8,000 btu/lb. How did processing increase
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