09 Jun EXPLAIN THE SHORT AND LONG TERM EFFECTS
You must read all of the articles (i will upload that) and based on these articles to answers 6 different questions. Each Answers should be approximately 220 words (around two paragraphs).
1. Is a current account deficit something to be avoided? Explain.
2. Use the Ricard Model of Comparative Advantage & the Heckler-Ohlin Model to explain how both poor and rich countries can be better off when they specialize in production and trade with one another.
3. Using general equilibrium analysis, graph and explain the effects of a small country levying a tariff on a good. What may be some of the long term effects not addressed by general equilibrium analysis?
4. Explain the short and long term effects resulting from a country’s currency depreciating.
5. How has the subprime mortgage crisis in the United States affected international trade in the rest of the world?
6. Do policies correlated with economic growth also facilitate international trade? Explain.
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