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Q. How can international trade in assets make both countries better off?
Answer: By permitting them to reduce the riskiness of the return on their wealth and by allowing the two parties to diversify their portfolios that is to divide their wealth among a wider spectrum of assets and therefore reduce the amount of money placed on one specific asset.
opportunity cost version is an improvement over the classical theory of international trade?comment
Criticism against Hechscher-Ohlin type trade theories is explained below: The foremost criticism leveled against Hechscher-Ohlin type trade theories are that they views compara
Q. How and why did Europe set up its single currency? Answer: The why part of the question is associated to large fluctuations in the exchange rates between the Europe
When asked by the Carnegie Commission to prepare a report on post war Preferential Trading Agreements, Viner (1950) pointed out that they are not free trade. He used the concepts o
Q. Use the diagram below taken from Figure 4-4 to identify the pre-trade situation for Australia and Sri-Lanka. Where on the K/L axis will you search each of the two countries? W
tion..What is the range of gross barter terms of trade ?
Q. Explain why in exchange rate-based stabilization plan may result in a real appreciation? Answer: annotation 8 gives three reasons: first, persistent inflation because of s
Q. Suppose the relative price of good 1 falls relative to the price of. What happens to the wage rate? Answer: The labour component of the price of 1 is bigger than that of p
Critical evaluation of Adam Smith''s Theory. Outline of its purest form. What is its critism?
Q. Developing countries have often attempted to establish cartels so as to counter the perceived or actual inexorable downward push on the prices of their exported commodities. OP
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