Author Question: Trade is generally harmful if there are large disparities between countries in wages. A) This is ... (Read 37 times)

tingc95 · **on:** Jun 30, 2018

Trade is generally harmful if there are large disparities between countries in wages.

A) This is generally true.
B) This is generally false.
C) Trade theory has nothing to say about this issue.
D) This is true if the trade partner ignores child labor laws.
E) This is true if the trade partner uses prison labor.

Question 2

The only reason that exchange rates change is because overall price levels in the countries change.

Indicate whether the statement is true or false

frejo · **Reply #1 on:** Jun 30, 2018

Answer to Question 1

B

Answer to Question 2

FALSE
Explanation: Relative price changes, in addition to inflation, can change the exchange rates.