What is the opportunity cost of Computers in the United States?
What is the opportunity cost of Shoes in the United States?
What is the opportunity cost of Computers in China?
Does either country have the absolute advantage in production of Shoes or Computers? Explain?
What is the opportunity cost of Shoes in China?
Analyze comparative advantage and opportunities for trade between the United States and China. Discuss.
Assuming a two-good, two country Ricardian model, if transportation costs for one good are very high or one of the goods is non-tradable, what is the probable outcome? Provide an example of a good with high transportation costs.
“Free trade is only beneficial if your country can stand up to foreign competition.” Is this statement true or false given an understanding of the Ricardian Model? Provide a short discussion (~3-5 sentences).
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