Exam 3: Gains and Losses From Trade in the Specific-Factors Model

A change in the relative price of one good versus another will cause a change in marginal product and the allocation of labor resources. When the price of good A increases relative to the price of good B and labor is mobile, the equilibrium real wage in industry A will:

(Multiple Choice)

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Question 81

In the two-sector (manufacturing and agriculture) specific-factors model, an increase in the price of the manufactured good will cause:

(Multiple Choice)

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Question 82

Suppose that land is specific to agriculture, capital is specific to manufacturing, and labor is mobile between sectors. If you know that the nominal income of capital and labor has fallen, then what can you say about the changes in the prices of manufactured goods and agricultural goods?

(Short Answer)

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Question 83

(Table: An Economy Before and After Trade) Why does the return to capital change after trade occurs? The top part of the table gives manufacturing and agricultural prices, production, resource utilization, and resource payments in autarky (a no-trade situation). The bottom part of the table provides (some of) the same information after trade occurs.

(Multiple Choice)

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Question 84

Suppose that the home country in the two-sector (manufacturing and agriculture) specific-factors model has a comparative advantage in agricultural output. What will happen to the return (rental) on capital when trade occurs?

(Multiple Choice)

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Question 85

Suppose that the home country in the two-sector (manufacturing and agriculture) specific-factors model has a comparative advantage in manufactured output. What is the change to the return on land after trade occurs?

(Multiple Choice)

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Question 86

In the two-sector (manufacturing and agriculture) specific-factors model, it is assumed that labor:

(Multiple Choice)

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Question 87

(Table: Revenues and Costs for Two Industries) Suppose that the table gives payments to labor, land, and capital in the manufacturing and agriculture sectors. Now, suppose that the price of manufacturing goods increases by 10% (P_M), and wages increase by 5%. What would we expect to take place?

(Multiple Choice)

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Question 88

Suppose that a country has a comparative advantage in agricultural products. When trade occurs, the nominal and real prices of the agricultural good will:

(Multiple Choice)

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Question 89

According to the two-sector (manufacturing and agriculture) specific-factor model, will returns to capital and land rise, fall, or not change when a country with a comparative advantage in agricultural output moves from an autarkic to a free trade situation?

(Short Answer)

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Question 90

The United States maintains a program to help workers affected by trade relocation. This is called:

(Multiple Choice)

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Question 91

Under free trade and comparative advantage, the home country:

(Multiple Choice)

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Question 92

(Table: An Economy Before and After Trade) What is the return to land after trade occurs? The top part of the table gives manufacturing and agricultural prices, production, resource utilization, and resource payments in autarky (a no-trade situation). The bottom part of the table provides (some of) the same information after trade occurs.

(Multiple Choice)

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Question 93

The absence of trade is known as:

(Multiple Choice)

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Question 94

In the two-sector (manufacturing and agriculture) specific-factors model, suppose that the home country has a comparative advantage in manufacturing output. Why does the return to capital change after trade occurs?

(Multiple Choice)

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Question 95

Suppose that land is specific to agriculture, capital is specific to manufacturing, and labor is mobile between sectors. According to the specific-factors model, if this country begins importing manufactured goods, which factor will experience the highest unemployment?

(Multiple Choice)

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Question 96

(Table: Revenues and Costs for Two Industries) Suppose that the table gives payments to labor, land, and capital in the manufacturing and agriculture sectors. Suppose further that the price of manufacturing goods increases by 10% (P_M), and wages increase by 5%; then the rental rate on capital will:

(Multiple Choice)

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Question 97

The two-sector (manufacturing and agriculture) specific-factors model assumes:

(Multiple Choice)

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Question 98

As a nation increases its production of exports, demand for all factors of production used in the exporting sector will:

(Multiple Choice)

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Question 99

Consider the following information for a hypothetical economy: If the price per bicycle is $20 and the wage per worker is $40, then what is the marginal product of labor?

(Multiple Choice)

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Question 100

Showing 81 - 100 of 148

A change in the relative price of one good versus another will cause a change in marginal product and the allocation of labor resources. When the price of good A increases relative to the price of good B and labor is mobile, the equilibrium real wage in industry A will:

In the two-sector (manufacturing and agriculture) specific-factors model, an increase in the price of the manufactured good will cause:

Suppose that land is specific to agriculture, capital is specific to manufacturing, and labor is mobile between sectors. If you know that the nominal income of capital and labor has fallen, then what can you say about the changes in the prices of manufactured goods and agricultural goods?

Suppose that the home country in the two-sector (manufacturing and agriculture) specific-factors model has a comparative advantage in agricultural output. What will happen to the return (rental) on capital when trade occurs?

Suppose that the home country in the two-sector (manufacturing and agriculture) specific-factors model has a comparative advantage in manufactured output. What is the change to the return on land after trade occurs?

In the two-sector (manufacturing and agriculture) specific-factors model, it is assumed that labor:

(Table: Revenues and Costs for Two Industries) Suppose that the table gives payments to labor, land, and capital in the manufacturing and agriculture sectors. Now, suppose that the price of manufacturing goods increases by 10% (P_M), and wages increase by 5%. What would we expect to take place?

Suppose that a country has a comparative advantage in agricultural products. When trade occurs, the nominal and real prices of the agricultural good will:

According to the two-sector (manufacturing and agriculture) specific-factor model, will returns to capital and land rise, fall, or not change when a country with a comparative advantage in agricultural output moves from an autarkic to a free trade situation?

The United States maintains a program to help workers affected by trade relocation. This is called:

Under free trade and comparative advantage, the home country:

The absence of trade is known as:

In the two-sector (manufacturing and agriculture) specific-factors model, suppose that the home country has a comparative advantage in manufacturing output. Why does the return to capital change after trade occurs?

Suppose that land is specific to agriculture, capital is specific to manufacturing, and labor is mobile between sectors. According to the specific-factors model, if this country begins importing manufactured goods, which factor will experience the highest unemployment?

(Table: Revenues and Costs for Two Industries) Suppose that the table gives payments to labor, land, and capital in the manufacturing and agriculture sectors. Suppose further that the price of manufacturing goods increases by 10% (P_M), and wages increase by 5%; then the rental rate on capital will:

The two-sector (manufacturing and agriculture) specific-factors model assumes:

As a nation increases its production of exports, demand for all factors of production used in the exporting sector will:

Consider the following information for a hypothetical economy: If the price per bicycle is $20 and the wage per worker is $40, then what is the marginal product of labor?

Trade in the Global Economy

Trade and Technology: The Ricardian Model

Trade and Resources: the Heckscher-Ohlin Model

Movement of Labor and Capital Between Countries

Increasing Returns to Scale and Monopolistic Competition

Offshoring of Goods and Services

Import Tariffs and Quotas Under Perfect Competition

Import Tariffs and Quotas Under Imperfect Competition

Export Subsidies in Agriculture and High-Technology Industries

International Agreements: Trade, Labor, and the Environment

The Global Macroeconomy

Introduction to Exchange Rates and the Foreign Exchange Market

Exchange Rates I: the Monetary Approach in the Long Run

Exchange Rates II: the Asset Approach in the Short Run

National and International Accounts: Income, Wealth, and the Balance of Payments

Balance of Payments I: the Gains From Financial Globalization

Balance of Payments II: Output, Exchange Rates, and Macroeconomic Policies in the Short Run

Fixed Versus Floating: International Monetary Experience

Exchange Rate Crises: How Pegs Work and How They Break

The Euro

Topics in International Macroeconomics

Filters

Exam 3: Gains and Losses From Trade in the Specific-Factors Model

A change in the relative price of one good versus another will cause a change in marginal product and the allocation of labor resources. When the price of good A increases relative to the price of good B and labor is mobile, the equilibrium real wage in industry A will:

In the two-sector (manufacturing and agriculture) specific-factors model, an increase in the price of the manufactured good will cause:

Suppose that land is specific to agriculture, capital is specific to manufacturing, and labor is mobile between sectors. If you know that the nominal income of capital and labor has fallen, then what can you say about the changes in the prices of manufactured goods and agricultural goods?

Suppose that the home country in the two-sector (manufacturing and agriculture) specific-factors model has a comparative advantage in agricultural output. What will happen to the return (rental) on capital when trade occurs?

Suppose that the home country in the two-sector (manufacturing and agriculture) specific-factors model has a comparative advantage in manufactured output. What is the change to the return on land after trade occurs?

In the two-sector (manufacturing and agriculture) specific-factors model, it is assumed that labor:

(Table: Revenues and Costs for Two Industries) Suppose that the table gives payments to labor, land, and capital in the manufacturing and agriculture sectors. Now, suppose that the price of manufacturing goods increases by 10% (PM), and wages increase by 5%. What would we expect to take place?

Suppose that a country has a comparative advantage in agricultural products. When trade occurs, the nominal and real prices of the agricultural good will:

According to the two-sector (manufacturing and agriculture) specific-factor model, will returns to capital and land rise, fall, or not change when a country with a comparative advantage in agricultural output moves from an autarkic to a free trade situation?

The United States maintains a program to help workers affected by trade relocation. This is called:

Under free trade and comparative advantage, the home country:

The absence of trade is known as:

In the two-sector (manufacturing and agriculture) specific-factors model, suppose that the home country has a comparative advantage in manufacturing output. Why does the return to capital change after trade occurs?

Suppose that land is specific to agriculture, capital is specific to manufacturing, and labor is mobile between sectors. According to the specific-factors model, if this country begins importing manufactured goods, which factor will experience the highest unemployment?

(Table: Revenues and Costs for Two Industries) Suppose that the table gives payments to labor, land, and capital in the manufacturing and agriculture sectors. Suppose further that the price of manufacturing goods increases by 10% (PM), and wages increase by 5%; then the rental rate on capital will:

The two-sector (manufacturing and agriculture) specific-factors model assumes:

As a nation increases its production of exports, demand for all factors of production used in the exporting sector will:

Consider the following information for a hypothetical economy: If the price per bicycle is $20 and the wage per worker is $40, then what is the marginal product of labor?

Trade in the Global Economy

Trade and Technology: The Ricardian Model

Trade and Resources: the Heckscher-Ohlin Model

Movement of Labor and Capital Between Countries

Increasing Returns to Scale and Monopolistic Competition

Offshoring of Goods and Services

Import Tariffs and Quotas Under Perfect Competition

Import Tariffs and Quotas Under Imperfect Competition

Export Subsidies in Agriculture and High-Technology Industries

International Agreements: Trade, Labor, and the Environment

The Global Macroeconomy

Introduction to Exchange Rates and the Foreign Exchange Market

Exchange Rates I: the Monetary Approach in the Long Run

Exchange Rates II: the Asset Approach in the Short Run

National and International Accounts: Income, Wealth, and the Balance of Payments

Balance of Payments I: the Gains From Financial Globalization

Balance of Payments II: Output, Exchange Rates, and Macroeconomic Policies in the Short Run

Fixed Versus Floating: International Monetary Experience

Exchange Rate Crises: How Pegs Work and How They Break

The Euro

Topics in International Macroeconomics

Filters

(Table: Revenues and Costs for Two Industries) Suppose that the table gives payments to labor, land, and capital in the manufacturing and agriculture sectors. Now, suppose that the price of manufacturing goods increases by 10% (P_M), and wages increase by 5%. What would we expect to take place?