Author Question: The two types of trade, intertemporal and pure asset swap ________ perfect substitutes, because ... (Read 57 times)

Metfan725 · **on:** Jun 30, 2018

The two types of trade, intertemporal and pure asset swap ________ perfect substitutes, because ________.

A) are; they both offer considerable payoff and are equal in the long run
B) are; they both involve the smoothing out of now and future consumption
C) are not; asset swapping is immediate and involves only assets, while intertemporal trade takes two time periods and involves both assets and goods/services
D) could possibly be; different economic states occur at different points in time
E) are not; asset swapping never relates to intertemporal trade

Question 2

Free trade is better than autarky for a small country.

Indicate whether the statement is true or false