midterm 2 review questions

midterm 2 review questions - One worker can produce Cans of...

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1. Which of the following is true of Rogowski’s model? A. Class cleavage is more likely to occur in countries with high land-labor ratio, while urban-rural cleavage is more likely to occur in countries with low land-labor ratio. B. Class cleavage is more likely to occur in advanced economy, while urban-rural cleavage is more likely to occur in backward economy. C. Class cleavage is more likely to occur in countries within which capital and land are abundant resource while labor is scarce resource D. Urban-rural cleavage is more likely to occur in countries within which labor is abundant resource while capital and land are scarce resource. 2. Suppose that in one working day, each worker in Mexico and Canada produces the following:
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Unformatted text preview: One worker can produce Cans of Tuna Bottles of Maple Syrup Country A 9 3 Country B 1 4 If countries A and B decide to participate in international division of labor and international trade, _______ will be specialized in producing tuna because _______. (A) B; her absolute advantage is larger (B) A; her absolute advantage is smaller (C) A; her comparative advantage is larger (D) B; her comparative advantage is larger (E) A; her absolute advantage is larger 3. If a state with a fixed exchange rate raises its interest rate, this will lead to a. Capital flowing in b. Capital flowing out c. No change in capital levels d. Either A or B (with no way to predict which one)...
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