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- Which of the following explains intra-industry trade? a. Wrong industrial classification b. All of the above c. Product differentiation d. Economies of scaleWhy is product differentiation by itself in capable of explaining intra-industry trade why does the explanation of intra- industry trade require both product differentiation and economies of scale1. Export Subsidies (under perfect competition) in a small countrya. For a small country, is the logic for why export subsidies provide negative gainsdifferent than the logic for why import tariffs provide negative gains? Explain2. Airbus and Boeing problem again. Suppose Boeing is more efficient at making airplanesthan Airbus. Starting from slide 33, Figure 10-9, let’s change the payoff matrix, so that if Boeingand Airbus both produce, Boeing gets +5, instead of -5. And, if Boeing produces, and Airbusdoes not produce, Boeing gets +125 instead of +100. Will there be a unique equilibrium in thiscase?3. Trade and the Environment Figure 11-4 in the slides shows a case of a negativeproduction externality and in which free trade leads to imports. Instead, analyze the case inwhich free trade leads to exports (i.e., the world price is greater than the no-trade price).a. Create your version of figure 11-4a, but illustrate the case in which the world price ishigher than the no-trade price.b.…
- The growing integration of the world econemy is Select one a. Increasing the intensity of competition in a widu range of manufacturing and service industrim b. increasing the intensity of competition in manutacturing industries, and decrpasing the mtensity of compotition in services c. narrowing the scope of competition in a wide ringe of service, commodity and manutacturing industries d. decreasing the ntensity of competbon in manufactring industries, nd mosing the intenity of competition in servicesFirms possessing resources or skills not available to competing firms may attempt to exploit it internationally. This is called: a. Use foreign raw materials b. Fully benefit from economies of scale c. React to trade restrictions d. Exploit monopolistic advantages. Identify a local competitor in your country and discuss their advantages and limitations with respect to their product offerings.
- Why does the explanation of intra-industry trade require both product differentiation and economies of scaleAntidumping laws O allow foreign firms to easily enter the domestic market. O allows domestic firms to be protected from foreign competition by lowering their competitors' costs. O allows foreign firms to be more competitive in the domestic market. O allow domestic firms to be protected from foreign competition by raising their competitors' costs.Explain with the help of diagrams:1. Assume that the Indian JuteIndustry is at present in a equilibrium state with the producers supplyingjute bags only to the domestic market atthe prevailing market prices. Apart from domestic suppliers, Indian juteindustry faces competition from Bangladesh. Explain with the help ofsupply-demand curves how the following events affect the equilibrium in thejute industry?a. Poor domestic demandb. Increasedcompetition from Bangladeshc. Cement industry,which is one of the largest users of jute bags,exempted from mandatory jute packagingd. Farmers, instead ofproducing jute, use their farm lands for some other purposes.
- Suppose that the U.S. textile industry is competitiveand there is no international trade in textiles. In longrunequilibrium, the price per unit of cloth is $30.a. Describe the equilibrium using graphs for theentire market and for an individual producer.Now suppose that textile producers in other countriesare willing to sell large quantities of cloth in theUnited States for only $25 per unit.b. Assuming that U.S. textile producers have largefixed costs, what is the short-run effect of theseimports on the quantity produced by an individualproducer? What is the short-run effect on profits?Illustrate your answer with a graph.c. What is the long-run effect on the number of U.S.firms in the industry?10. major features of the linder theory of trade are that it focuses on ___. ---- patterns in countries and also introduces, in contrast to traditional trade theories, the general concept of trade a. demand; intra-industry b. demand; inter industry C. supply; intra industry d. supply; inter industryhelp explain this pls. International trade is the subject of much debate. Many economist favor encouraging international trade, citing the benefits gained by trade. However, there are economic arguments for limiting international trade with protectionism. Classify the given statements into the appropriate category. Look at image for answer bank. Arguments for promoting international trade Arguments for limiting international trade with protectionism
