International trade, Strategic Management

Assignment Help:

Suppose that the small country of Fiji is isolated from the rest of the world and no international trade occurs due to prohibitively high transportation costs. Amongst other things, Fijians produce and consume coconuts and material (for making clothes) in perfectly competitive markets.
 
(a)  Illustrate the equilibrium autarky price and quantity of coconuts and material and the associated consumer and producer surpluses.   Suppose that transportation costs fall dramatically and that international trade is now commercially viable and that the Fijian government does not implement any trade restricting policies.  

(b)  Suppose that, the world price of coconuts (adjusted for the reduced transportation costs) is significantly higher than Fiji's autarky price.  Illustrate the new competitive equilibrium in Fiji's coconut market and identify: any exports or imports of coconuts; the new consumer and producer surpluses and the gains from international trade.  How would your answer change if Fiji produced a significant proportion of the world's coconuts (i.e. it was not "small" in this market)? 

(c)  Suppose that, the world price of material (adjusted for the reduced transportation costs) is significantly lower than Fiji's autarky price of material.  Illustrate the new competitive equilibrium in Fiji's material market and identify: any exports or imports of materials; the new consumer and producer surpluses and the gains from international trade.  

(d) Within Fiji, who gains and who losses from international trade in coconuts and materials and by how much?  (Refer to your charts in parts (b) and (c)).


Related Discussions:- International trade

Mission statements for an organization, a) Examine core organizational valu...

a) Examine core organizational values (ethical, cultural, environmental, social and business) with the present business objectives of an organization. b) Make appropriate vision a

Who are burns and stalker, Q. Who are burns and stalker? Burns and Stal...

Q. Who are burns and stalker? Burns and Stalker in their 1961 book 'The Management of Innovation'explained two organisational types signifying a spectrum which organisations co

Synergy, Mergers and acquisitions (abbreviated M&A) are both an aspect of c...

Mergers and acquisitions (abbreviated M&A) are both an aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of di

Define strategic planning, QUESTION Firms often compete with each other...

QUESTION Firms often compete with each other to gain their customers' attention and business. While doing so, each firm tries to chalk out its unique strategy or gameplan. Stra

Briefly explain the it merger process, Question: (a) Company mergers a...

Question: (a) Company mergers are major change projects. Briefly explain the IT merger process involved. (b) A study showed that successful steering committees introduce a

Organisation and develop a strategic plan, Develop Strategic Plan This...

Develop Strategic Plan This assessment requires that you analyse the capabilities of an organisation and develop a strategic plan. To enable you to do this you must complete t

Doric conversion technologies, Doric Conversion Technologies, Inc. Requi...

Doric Conversion Technologies, Inc. Requirements: 1.      Consider the case study from the perspective of Kantianism and Social contract theory. On the basis of the ethical d

Management and Strategy, #quesWhat features of Johnson & Johnson''s "Our Cr...

#quesWhat features of Johnson & Johnson''s "Our Credo" made it so effective in guiding J&J''s response to the Tylenol tampering crisis? Where was J&J''s "Our Credo" in the run-up t

Cues of unmet demand, what cues that might cause a company to suspect there...

what cues that might cause a company to suspect there is unmet demand for its products or services. How would I design a test to determine whether My suspicions are correct?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd