1. How do economies of scale give rise to international trade? A. International trade occurs because...
1. How do economies of scale give rise to international trade?
A.
International trade occurs because it increases the market size.
B.
They enhance resource differences between countries.
C.
International trade occurs because economies of scale transfer knowledge across countries.
D.
International trade occurs because of multi-national corporations.
Homework Answers
Ans is A
economies of scale means average cost decreases as quantity increases. Thus when an economy opens for an international trade, then market size increases which leads economy to take an advantage of economies of scale.
Add Answer to:
1. How do economies of scale give rise to international
trade?
A.
International trade occurs because...
1. In the case of trade based on external economies of scale, the pattern of trade...
1. In the case of trade based on external economies of scale, the pattern of trade is determined by relative factor abundance. determined by comparative advantage. determined by relative technological differences. determined by history and accident. 2. Dynamic returns to scale refer to average cost falls with current rate of production marginal cost falls with current production average cost falls with cumulative production over time. marginal cost fall with cumulative production over time. 3. In which of the following cases...
International trade based on scale economies is likely to be associated with O A. the law...
International trade based on scale economies is likely to be associated with O A. the law of diminishing returns O B. Ricardian comparative advantage O C. absolute advantages due to resource abundance. O D. comparative advantages associated with Heckscher-Ohlin factor-proportions. O ENone of the above.
. Why similar countries trade Aa Aa Consider two hypothetical countries called Cassvania and Koopmansville. The...
. Why similar countries trade Aa Aa Consider two hypothetical countries called Cassvania and Koopmansville. The countries have similar resource endowments and production technology, and yet they specialize and trade with each other. Read the following details and determine why international trade is possible between these two countries. Koopmansville has many natural lakes and streams. As a result, its residents grow up on the water and have a natural sense of how boats should work and be made. Because of...
2. Under Internal Scale Economies and Monopolistic Competition, what is the impact of International Trade on...
2. Under Internal Scale Economies and Monopolistic Competition, what is the impact of International Trade on the price in an industry? Circle one option. (1 point) a. The price increases b. The price decreases C. The price stays the same d. Not enough information to determine the effect of International Trade on the price
international trade: Internal Economies of Scale Problem 1 Suppose two countries, Canada and Japan are considering...
international trade: Internal Economies of
Scale
Problem 1 Suppose two countries, Canada and Japan are considering making computers. Firms in each individual country are identical and symmetric in their cost structures. It costs $5 Million to set up a computer production facility and then an addition $20 to make each computer individually, in either country. The price at which each firm can sell its computers is affected by the amount of firms it must compete with, and is given by...
5 points QUESTION 11 Trade has no effect on the distribution of incomes within countries in trade relations. True False 5 points QUESTION 12 Internal economies of scale form the basis for internationa...
5 points QUESTION 11 Trade has no effect on the distribution of incomes within countries in trade relations. True False 5 points QUESTION 12 Internal economies of scale form the basis for international trade. True False 5 points QUESTION 13 Economies of scale give rise to international trade True False 5 points QUESTION 14 Preferential trade agreements are welfare improving if they lead to trade diversion. True False 5 points QUESTION 15 GATT is a more formal organization with larger...
4. Under Internal Scale Economies and Monopolistic Competition, explain how this type of International Trade is...
4. Under Internal Scale Economies and Monopolistic Competition, explain how this type of International Trade is consistent with the Gravity Model of Trade. (2 points) a.
International trade ar 36 Internal economies of scale will by average cost when output is Pr...
International trade
ar 36 Internal economies of scale will by average cost when output is Pr A) increase; increas ed; a firm B) reduce; increased; the industry C) increase; increased; the industry D) reduce; reduce; the industry E) reduce; increased; a firm and 37 The learning curve describes the A) direct; unit cost; cumulative output B) inverse; educ ation; annual income C) inverse; unit cost; cumulative output D) direct; education; annual income E) direct; education; labor productivity , relationship between...
28 When there are external economies of scale, an increase in the size of the market...
28 When there are external economies of scale, an increase in the size of the market will: A) not affect the number of firms, but will lower the price per unit. B) decrease the number of firms and lower the price per unit. C) decrease the number of firms and raise the price per unit. D) increase the number of firms and raise the price per unit. E) increase the number of firms and lower the price per unit. -...
3. Under Internal Scale Economies and Monopolistic Competition, explain how International Trade can improve economic efficiency...
3. Under Internal Scale Economies and Monopolistic Competition, explain how International Trade can improve economic efficiency within an industry by changing the types of firms in the industry. (2 points)
International trade based on scale economies is likely to be associated with O A. the law of diminishing returns O B. Ricardian comparative advantage O C. absolute advantages due to resource abundance. O D. comparative advantages associated with Heckscher-Ohlin factor-proportions. O ENone of the above.
. Why similar countries trade Aa Aa Consider two hypothetical countries called Cassvania and Koopmansville. The countries have similar resource endowments and production technology, and yet they specialize and trade with each other. Read the following details and determine why international trade is possible between these two countries. Koopmansville has many natural lakes and streams. As a result, its residents grow up on the water and have a natural sense of how boats should work and be made. Because of...
2. Under Internal Scale Economies and Monopolistic Competition, what is the impact of International Trade on the price in an industry? Circle one option. (1 point) a. The price increases b. The price decreases C. The price stays the same d. Not enough information to determine the effect of International Trade on the price
international trade: Internal Economies of
Scale
Problem 1 Suppose two countries, Canada and Japan are considering making computers. Firms in each individual country are identical and symmetric in their cost structures. It costs $5 Million to set up a computer production facility and then an addition $20 to make each computer individually, in either country. The price at which each firm can sell its computers is affected by the amount of firms it must compete with, and is given by...
4. Under Internal Scale Economies and Monopolistic Competition, explain how this type of International Trade is consistent with the Gravity Model of Trade. (2 points) a.
International trade
ar 36 Internal economies of scale will by average cost when output is Pr A) increase; increas ed; a firm B) reduce; increased; the industry C) increase; increased; the industry D) reduce; reduce; the industry E) reduce; increased; a firm and 37 The learning curve describes the A) direct; unit cost; cumulative output B) inverse; educ ation; annual income C) inverse; unit cost; cumulative output D) direct; education; annual income E) direct; education; labor productivity , relationship between...
28 When there are external economies of scale, an increase in the size of the market will: A) not affect the number of firms, but will lower the price per unit. B) decrease the number of firms and lower the price per unit. C) decrease the number of firms and raise the price per unit. D) increase the number of firms and raise the price per unit. E) increase the number of firms and lower the price per unit. -...
3. Under Internal Scale Economies and Monopolistic Competition, explain how International Trade can improve economic efficiency within an industry by changing the types of firms in the industry. (2 points)
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