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Q. Now, consider that the relative price of A is actually not higher than Albania's autarkic level of 1, but quite the opposite (e.g. PA/PB = 0.5). Could Albania still be able to gain from trade? If so, where could be its production point? Given the information in this question, where is Albania's comparative advantage?
Answer: Yes as long as the world's terms of trade differed from those of Albania that country stands to increase from international trade. In this particular case its aim of production with trade would be at point c.
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discuss the possibility of trade if factor endowment are identical and tasde is different
Discuss the exceptional supply curve
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different between her barter terms of trade and net barter terms of trade
Q. Explain how a rise in real income affects aggregate demand. Answer: An increase in domestic real income Y leads to a rise in disposable income Yd. This increases
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organistion and style of writing the research report
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