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Q. Why do we observe the Leontief paradox?
Answer: There are several possible answers that they may be categorized into three groups. One would argue that the theory or model is wrong. The other would dispute that the theory is correct (internally consistent and descriptive of real world data) however the real world data is incorrectly defined perceived, or measured. The third would dispute that the statement itself is wrong, and that in reality the Leontieff paradox itself isn't actually observed, but somewhat is due to faulty logical rendering of the original model.
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 allowin
Q. The Heckscher-Ohlin model is famous for being elegant and mathematically sophisticated, yet failing to define reality. One manifestation of this fact is Trefler's Case of Missi
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Q. What are the three main reasons why governments sometimes chose to devalue their currencies? Answer: 1. Permit the government to fight domestic unemployment despite the
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If one were to use the simple monetary model to predict the $/Euro exchange rate (L is constant), what would the expected exchange rate be?
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