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Q.. "A good cannot be both land- and labor-intensive." Discuss. Answer: In a two good or two factor models for instance the original Heckscher-Ohlin framework and the factor
Q. What are the main points of economic life that macroeconomics analysis is most concerned with? Answer: There are four major aspects that are saving, unemployment, trade imb
Q. Discuss the differences between Absolute PPP and Relative PPP. Answer: Absolute Purchasing Power Parity (PPP) states that the exchange rate between two currencies e
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
What effect do non-tradable goods have on PPP? Answer: The consequence is quite substantial. In 1997 the production of non-tradable goods accounted for about 55% of U.S GNP.
Q. Explain why Relative PPP is useful when comparing countries that base their price levels on different product baskets. Answer: For instance If the U.S price level increase
Strategic groups "Strategic groups are organizations within an industry with similar strategic characteristics, following similar strategies or competing on similar bas
Brifly explaine the alternative explanation to the theory of international trade
Q. "The line distinguishing between external and internal goals can be fuzzy." Discuss. Answer: True For instance employment target for export industries when export growth m
is general equilibrum in trade
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