Chapter 9

Chapter 9 - Chapter 9 Application: International Trade The...

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Chapter 9 Application: International Trade
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The Determinants of Trade The equilibrium without trade Domestic buyers and sellers Equilibrium price and quantity Determined on the domestic market Total benefits Consumer surplus Producer surplus
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The Determinants of Trade Allow for international trade? What will happen to price and quantity sold in domestic market? Who will gain from free trade; who will lose, and will the gains exceed the losses? Should a tariff be part of the new trade policy?
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The World Price and Comparative Advantage If a country has a comparative advantage, then the domestic price will be below the world price, and the country will be an exporter of the good. If the country does not have a comparative advantage, then the domestic price will be higher than the world price, and the country will be an importer of the good.
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The Winners and Losers From Trade The gains and losses of an exporting country
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This note was uploaded on 04/26/2011 for the course ECON 201 taught by Professor Joyce during the Spring '07 term at Drexel.

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Chapter 9 - Chapter 9 Application: International Trade The...

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