Industrial Organization

ECN 338: Midterm Exam Notes KOM: Chapter 1: Introduction ?Q: How is the US adequate to leave for all the excess imported goods? A: The funds is supplied by large inflows of majuscule, money invested by foreigners willing to study a stake in the US economy. 1. Gains from switch oer Benefits: - backup provides benefits by allowing countries to barter goods whose production makes relatively dense intake of resources that are topically abundant while trade goods whose production makes heavy use of resources that are locally scarce. - Allows countries to delimitate in producing a narrower cathode-ray oscilloscope of goods, giving them greater efficiencies of large production. Disadvantages: - Effects income distribution in much(prenominal) a elan that owners of specific resources that compete with imports cannot go through employment in other industries. 2. Pattern of shift who sells what to whom - humour and resources - Relative supplies of earthal reso urces such as capital, labor, and land 3. How Much Trade? - Free trade is good for prosperity and world peace - Quotas on imports and subsidies on exports have been used to regulate 4. Balance of Payments Q: Is it better to strain out a trade deficit or trade overplus? A: Depends on an frugal analysis of the wedded untaught 5.

deputise Rate Determination - Values of currencies heighten over time 6. International constitution Coordination - One countries economic policies affect other countries - Differences in country goals lead to conflicts of pertain 7. International Capital Market - Set of arrangements by which individuals and firms turn money now for promises to pay back in the next - silver fluctuatio! ns: can cause a risk to the capital foodstuff such as if one countries currency waterfall the investor in that country would suffer capital loss - subject area default: nation may refuse to pay its debts Chapter 2: World Trade Overview Gravity Model- helps to make sense of the apprize of trade surrounded by any pair of countries and as well sheds light on the...If you expect to get a plenteous essay, order it on our website: OrderEssay.net

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