Category: Foundations Of Modern Trade Theory

A. Only countries with low wages will export
B. Only countries with high wages will import
C. Countries with high wages will have higher prices
D. All of the above are false

A. Export steel
B. Export DVDs
C. Exports steel and DVDs
D. There is no basis for gainful specialization and trade

A. Trades at Canada’s marginal rate of transformation
B. Trade at Sweden’s marginal rate of transformation
C. Specializes completely in the production of its export good
D. Specializes partially in the production of its exports goods

A. Product X
B. Product Y
C. Neither X nor Y
D. Both X and Y

A. shift out in a parallel fashion
B. shift in a parallel fashion
C. Become steeper
D. Become flatter

A. Ricardian theory of comparative
B. Heckscher Ohl in theory of comparative advantage
C. Linder theory of overlapping demand all of the above
D. None of these

A. There is no basis for gainful trade for either country
B. Both countries gain from trade
C. Only one country gains from trade
D. One country gain and the other country loses from trade

A. Shift out in a parallel fashion
B. shift in a parallel fashion
C. become steeper
D. Become flatter

A. 1W = 1B
B. 1W = 2B
C. 1W = 3B
D. 1W = 1/3B

A. Theory of reciprocal demand
B. Theory of absolute advantage
C. Theory of comarative advantage
D. Theory of mercantilism