Author Question: Use national demand and supply curves to show (a) the incentives for trade to begin between nations. ... (Read 60 times)

asd123 · **on:** Jun 30, 2018

Use national demand and supply curves to show (a) the incentives for trade to begin between nations. (b) the effect on the likely pattern of trade of a change in technology in A that causes A's national supply curve to shift out.

(c) the effect on the likely pattern of trade of a change in tastes in B in favor of good S.

Question 2

In leading the opposition to the adoption of NAFTA, H. Ross Perot argued that NAFTA would lead to

A) a loss of U.S. competitiveness with Canada.
B) a loss of U.S. manufacturing jobs to Mexico.
C) a loss of U.S. willingness to negotiate the Uruguay Round.
D) All of the above.

soda0602 · **Reply #1 on:** Jun 30, 2018

Answer to Question 1

(a) Trade is likely to occur along the lines of comparative advantage.
(b) An increase in supply of S in A will cause A to export more S (import less S).
(c) An increase in demand for S in B will cause B to import more S (export less S).

Answer to Question 2

B