Chapter 20: Q 26. (page 494)
In World Trade Organization meetings, what do
Do you think low-income countries lobby for?
I think low-income countries would lobby for minimization or full stoppage of trade barriers.
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What are the two main sources of economic gains from intra-industry trade?
In Exercise 20.31, is there an “ask” where Venezuelans may say “no thank you” to trading with Canada?
You just got a job in Washington, D.C. You move
into an apartment with some acquaintances. All your roommates, however, are slackers and do not clean up after themselves. You, on the other hand, can clean faster than each of them. You determine that you are 70% faster at dishes and 10% faster with vacuuming. All of these tasks have to be done daily. Which jobs should you assign to your roommates to get the most free time overall? Assume you have the same number of hours to devote to cleaning. Now, since you are faster, you seem to get done quicker than your roommate. What sorts of problems may this create? Can you imagine a trade-related analogy to this problem?
True or False: The source of comparative advantage must be natural elements like climate and mineral deposits. Explain.
You just overheard your friend say the following: “Poor countries like Malawi have no absolute advantages. They have poor soil, low investments in formal education and hence low-skill workers, no capital, and no natural resources to speak of. Because they have no advantage, they cannot benefit from trade.” How would you respond?
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