Comparative Advantage

Here is the problem. When you give me the solutions for these problems, please make them as detail as possible you can. 1. Suppose that in England 5 man-hours of labor are required to produce each cask of wine and 5 man-hours are required to produce each bolt of cloth, whereas in Portugal 1 man-hour of labor is required for a cask of wine and 4 man-hours for a bolt of cloth (Except for the choice of numbers, this is the example used by Ricardo to discuss comparative advantage). a) Prove that when both countries are producing both goods, the world can be made better off by allowing England and Portugal to reallocate labor and trade in accordance with the patter of comparative advantage... click for more

International Economics - Japan has had an overall trade surplus in recent years.

Japan has had an overall trade surplus in recent years. Economists suggest that this continuing phenomenon is due to several things, including an inappropriate exchange rate ans a failure of government policies to sufficiently stimulate the Japanese economy to import more. How would a Mercantilist view this surplus? Why might David Hume argue that the surplus will disappear?

Ricardian Model (developing & industrialized countries)

In the light of the Ricardian model, how might you evaluate the claim by developing countries that they are at a disadvantage in trade with powerful industrialized countries?

Evaluation - If the United States productivity growth

If the United States productivity growth does not keep up with that of its trading partners, the United States will quickly lose its international competitivesness and not be able to export any products, and its standard of living will fall. Critically evaluate this statement.

International Economics - Willingness to Trade

Suppose that Country I and trading partner Country II decrease their willingness to trade at the same time. What will be the impact on the terms of trade and on the volume of trade?