Macro Ch 5 Problems - and each of the two goods. As a...

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4.) For each of the following trade relationships, explain the likely source of the comparative advantage of each of the exporting countries. a.) The Unites States exports software to Venezuela, and Venezuela exports oil to the United States. b.) The United States exports airplanes to China, and China exports clothing to the United States c.) The United States exports wheat to Columbia, and Colombia exports coffee to the United States. 8.) Before the North American Free Trade Agreement (NAFTA) gradually eliminated import tariffs on goods, the autarky price of tomatoes in Mexico was below the world price and in the United States was above the world price. Similarly, the autarky price of poultry in Mexico was above the world price and in the United States was below the world price. Draw diagrams with domestic supply and demand curves for each country
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Unformatted text preview: and each of the two goods. As a result of NAFTA, the United States now imports tomatoes from Mexico and the United States now exports poultry to Mexico. How would you expect the following groups to be affected? a.) Mexican and U.S. consumers of tomatoes. Illustrate the effect on consumer surplus in your diagram. b.) Mexican and U.S. producers of tomatoes. Illustrate the effect on producer surplus in your diagram. c.) Mexican and U.S. tomato workers. d.) Mexican and U.S. consumers of poultry. Illustrate the effect on consumer surplus in your diagram. e.) Mexican and U.S. producers of poultry. Illustrate the effect on producer surplus in your diagram. f.) Mexican and U.S. poultry workers. 11.) Skip 12.) Skip (11 and 12 deal with quotas and tariffs which we skipped.)...
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This note was uploaded on 01/05/2012 for the course ECN 222 taught by Professor Lawson during the Summer '08 term at University of North Carolina Wilmington.

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