Question

Matching the concepts with their explanations A model shows that bilateral trade is directly based on economic sizes but indirectly affected by distance between two countries. A Ricardian Model A model states that international trade is a zero-sum game 2 Adam Smith view of International Trade and a country should maintain a positive trade balance. A trade model states that a country should export the goods for which it has the comparative advantage (lower opportunity cost) Neoclassical Model 3 Also called "Reciprocal Demand Curve" which shows how 4 Offer Curve D trade volume changes when terms of trade (TOT) changes. A model states that international trade is a positive-sum game and country should export those goods which they ca produce efficiently Relative Price 5 Another term as "Opportunity Cost" or "Autarky Price F Gravity Model 6 Ratio" A trade model states that countries can still gain from trade even they share the identical Supply conditions (identical PPF) Mercantilism G 7

Answer 1

I’m giving you the direct answers because the right panel in the question itself is the explanation to the ones in left panel. I hope it helps.

A-3

B-7

C-2

D-4

E-6

F-1

G-5