Exam 3: Sources of Comparative Advantage

Which trade theory is tantamount to a short-run version of the factor price equalization theory?

According to the product-life-cycle theory,the first stage of a product's trade cycle is when it is introduced to the home market.

The Leontief paradox provided:

With economies of scale,specialization in a few products allows a manufacturer to benefit from longer production runs which lead to decreasing average cost.

Dynamic comparative advantage refers to the creation of comparative advantage through the mobilization of skilled labor,technology,and capital.

According to the product life cycle model,comparative advantage shifts from cheap-labor countries to high-technology countries after a manufactured good becomes standardized.

Boeing aircraft company was able to cover its production costs of the first "jumbo jet" in the 1970s because Boeing could market it to several foreign airlines in addition to domestic airlines.This illustrates:

The factor endowment theory assumes

Recent studies of U.S.resource endowments indicate that the United States is most abundant in unskilled labor,followed by semi-skilled labor and skilled labor.

Which nation has sometimes been characterized as being a "pollution haven" due to its lenient environmental standards that encourage the production of pollution-intensive goods?

Because seasons in the Southern Hemisphere are opposite those in the Northern Hemisphere,one would expect intraindustry trade to occur in agricultural products.

Which of the following is a long-run theory,emphasizing changes in the trading position of a nation over a number of years?

With decreasing costs,a country has an incentive to partially specialize in the product of its comparative advantage.

According to the factor-endowment theory,international specialization and trade cause a nation's cheap resource to become cheaper and a nation's expensive resource to become more expensive.

To justify the subsidies it has received from European governments,The Airbus Company has used all of the following arguments except:

Most economists maintain that the major factor underlying wage stagnation in the United States in the 1990s has been:

Which of the following suggests that by widening the market's size,international trade can permit longer production runs for manufacturers,which leads to increasing efficiency?

Which trade theory suggests that a newly produced good,once exported,could ultimately end up being imported as the technology is transferred to lower- cost nations?

The Leontief Paradox suggested that,in contrast to the predictions of the factor-endowment theory,U.S.exports were less capital-intensive than U.S.import-competing goods.

A firm is said to enjoy economies of scale over the range of output for which the long-run average cost is: