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    Applied International Economics
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    Exam 4: Factor Endowments and the Commodity Composition of Trade
  5. Question
    Explain How Trade Would Tend to Equalize Differences in the Prices
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Explain How Trade Would Tend to Equalize Differences in the Prices

Question 114

Question 114

Essay

Explain how trade would tend to equalize differences in the prices of factors of production between countries that trade. How would this influence the distribution of income?

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Trade tends to equalize differences in t...

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