Briefly explain the sources of gains from trade.
When countries produce according to their comparative advantage, they produce the goods in which they have comparative advantages respectively. This increases economic efficiency and the total production of both the goods. This lowers costs and increases total production.
Ragan discusses the sources of gains from international trade in Chapter 33 of their book. How important have such sources of gains been for the company Instagram? Provide references, please.
a) Explain why there are unexploited gains from trade in a monopoly market. b) Why does a monopolist not increase output to achieve Pareto optimality even though there are potential gains from trade? (10 marks)
The international terms of trade (tot) influence the extent to which a country gains from trade. Explain what is meant by terms of trade, and how do changes in the terms of trade affect the ‘welfare’ effects of trade.
6. If the relative opportunity costs of producing goods are identical across countries, then there are tary p A. no gains from trade. for t B. gains from trade if trade is based on absolute advantage mand C. gains from trade if trade is based on comparative advantage pply D. gains from trade that depend on the degree of competition between intemational traders. nd fo 7. The text lists three reasons why economists and non-economists see the pros and cons...
What are the channels of the gains from trade in the presence of scale economies (increasing returns to scale)? Explain these channels with graphical illustration.
1) What is the Heckscher-Ohlin theorem? 2) Name three dynamic gains from trade. 3) Explain the price-specie flow doctrine. 4) Identify and describe the three “waves” of globalization discussed in the lecture.
When mexico trade cement for US computer, the gains from trade can be expressed as?
Which of the following transactions is not an example of gains from trade? Items (7 items) (Drag and drop into the appropriate area below) Someone steals a bag of groceries from your car to feed his hungry children. The Philadelphia 76ers basketball team trades all of its young stars to the Los Angeles Lakers in exchange for draft picks. A group of friends agree that whoever bets on the loser of the Monday night game must pay $5 to whoever...
What are the gains from trade of entering into a swap for these two firms? Firm A Firm B Fixed Rate 9% 5% Floating Rate LIBOR + 7% LIBOR + 4% Ans. Gains from trade are 1%. (I dont know how to get this answer) Possible further question: How to arrange a swap contract so that Firm A earns 0.6% from it?
Explain briefly the basic Trade Theories based on comperative advantage