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Author Question: If one country's wage level is very high relative to the other's (the relative wage exceeding the ... (Read 83 times)

lidoalex

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on: Jun 30, 2018
If one country's wage level is very high relative to the other's (the relative wage exceeding the relative productivity ratios), then if they both use the same currency
 
  A) neither country has a comparative advantage.
  B) only the low wage country has a comparative advantage.
  C) only the high wage country has a comparative advantage.
  D) consumers will still find trade worth while from their perspective.
  E) it is possible that both will enjoy the conventional gains from trade.

Question 2

In the model of monopolistic competition, if firms have ________ average cost curves, then opening trade will cause ________ firms to ________ the industry.
 
  A) different; less efficient; exit
  B) different; more efficient; enter
  C) symmetric; less efficient; exit
  D) symmetric; more efficient; enter
  E) symmetric; less efficient; enter


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blazinlyss

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Reply #1 on: Jun 30, 2018
Answer to Question 1

E

Answer to Question 2

A


lidoalex

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Reply #2 on: Jun 30, 2018
Thank you :)


blazinlyss

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Reply #3 on: Jun 30, 2018
Happy to help you


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