Exam 3: Labor Productivity and Comparative Advantage: The Ricardian Model

When compared with China,the growth of clothing exports originating in Bangladesh clearly illustrates the difference between absolute and comparative advantage.Discuss and explain.

If one country's wage level is very high relative to the other's (the relative wage exceeding the relative productivity ratios)then it is probable that

Let us define the real wage as the purchasing power of one hour of labor.In the Ricardian 2X2 model,if two countries under autarky engage in trade then

If a production possibilities frontier is bowed out (concave to the origin),then production occurs under conditions of

According to Ricardo,a country will have a comparative advantage in the product in which its

If labor productivities were exactly proportional to wage levels internationally,this would

Trade in a One-Factor World -Given the information in the table above,Home's opportunity cost of widgets is

-Given the information in the table above.What is the opportunity cost of cloth in terms of Widgets in Foreign?

Trade in a One-Factor World -Given the information in the table above,Foreign's opportunity cost of widgets is

In the Ricardian model,comparative advantage is likely to be due to

How does the two-good,two-country version of the Ricardian model differ from the two-country,many-good model in terms of the determination which goods are produced and exported by each country?

-Given the information in the table above.If these two countries trade these two goods in the context of the Ricardian model of comparative advantage,then what is the lower limit of the world equilibrium price of widgets?

If two countries engage in Free Trade following the principles of comparative advantage,then

In 1975,wage levels in South Korea were roughly 5% of those in the United States.It is obvious that if the United States had allowed Korean goods to be freely imported into the United States at that time,this would have caused devastation to the standard of living in the United States,because no producer in this country could possibly compete with such low wages.Discuss this assertion in the context of the Ricardian model of comparative advantage.

Trade in a One-Factor World -Given the information in the table above,if the world equilibrium price of widgets were 40 cloths,then

-Given the information in the table above,if it is ascertained that Foreign uses prison-slave labor to produce its exports,then home should

Trade in a One-Factor World -Given the information in the table above,if wages were to double in Home,then Home should

If the world terms of trade for a country are somewhere between the domestic cost ratio of H and that of F,then

Which of the following statements is TRUE?

Suppose the United States' production possibility frontier was flatter to the widget axis,whereas Germany's was flatter to the butter axis.We now learn that the German mark sharply depreciates against the U.S.dollar.We now know that