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Q. How mobile is Europe's labor force? Answer: Differences in culture and language discourage labour movements between European countries. Differences in regional unempl
Q. Albania refused to engage in international trade for ideological reasons. To maximize its economic welfare it could choose to produce at which point in the diagram above? Sup
Q. Presumably, since the United States is a large country in many of its international markets, a positive optimum tariff exists for this country. It follows thus that when any l
Does the existence of non-tradable goods allow for deviations from Purchasing Power Parity? Answer: Yes the continuation of non-tradable goods permits deviations from Purchas
Present and explain the Fundamental Equation of the Monetary Approach. Answer: Suppose E $ /E = P US /P E and that domestic price levels depend on domestic money demands and
Q. The 1980s are considered as the "lost decade" of Latin American growth. Explain why? Answer: Whilst the Great Depression made it hard for developing countries to make pa
Q. Imagine a world with two large countries, Home and Foreign. Evaluate how Home's macroeconomic policies affect Foreign. Compare the small and the large country cases; consider
What are the government's fiscal policy options for a recessionary gap caused by cost-push inflation? Use the aggregate demand-aggregate supply model to show the impact of these p
Q. Even though it is very clear in the context of the Specific Factors model that an expansion of international trade will make losers as well as winners, economists still claim t
distinguish between net terms of trade and gross terms of trade
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