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Unformatted text preview: Econ 370 Fall 2011 International Trade Professor Soderbery Homework 4 ANSWER KEY Monopolistic Competition and Intra-Industry Trade (IIT) 1. Calculate the intra-industry trade index for rice (HS 1006) and motor cars (HS 8703) in 2010 for Canada and Japan and the Entire World. To obtain the export and import values, access the U.S. Trade Stats Express Web site ( http://tse.export.gov/ ), click on “National Trade Data” then “Global Patterns of U.S. Merchandise Trade.” Under the “Product” section, change the item to rice or cars. Which product did you expect to have a higher index of intra-industry trade? Did you expect this to be different across countries? Explain your expectations for both? ANSWER: ¡¢£¤¥¦§¥ ¡¨©ª « ¡¢¬¨©®¥¨©ª¢£ ¯ °±¡±²¬²¥¦§¥ ²³¦©¨¥ª¡¢´¤³¦©¨ µ ¶ · ²³¦©¨ ¸ ´¤³¦©¨¹ HS-1006-RICE Exports to the world = 2,354,000,000 Imports from the world = 573,769,000 Index of IIT RICE = 39.2% Exports to Canada = 165,000,000 Imports from Canada = 3,204,000 Index of IIT RICE = 3.8% Exports to Japan = 232,000,000 Imports from Japan = 301,000 Index of IIT RICE = .25% HS-8703-CARS Exports to the world = 39,297,000,000 Imports from the world = 115,325,000,000 Index of IIT CARS = 50.8% Exports to Canada = 11,811,000,000 Imports from Canada = 35,996,000,000 Index of IIT CARS = 54% Exports to Japan = 383,000,000 Econ 370 Fall 2011 International Trade Professor Soderbery Imports from Japan = 31,973,000,000...
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This note was uploaded on 02/06/2012 for the course ECON 370 taught by Professor Staff during the Fall '08 term at Purdue.
- Fall '08
- Monopolistic Competition