EC 420 Study Guide - Midterm Guide: Exact Change, Economic Surplus, Omics
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The following questions have appeared on previous versions of the second exam. This does not exhaust the list of possible exam questions. Also, be aware that if similar questions are asked on future exams, they may be asked with a new twist: do the following in the context of the two good, two factor heckscher-ohlin model. On your diagram, indicate the points of production and consumption, exports and imports, the initial level of welfare and the world relative price of clothing. Briefly explain your diagram: on your diagram from part a, show what happens when the world price of food falls (even after the fall in price, the country still exports food). Show the new, points of production and consumption, exports and imports, level of welfare, and the world relative price of clothing. Briefly explain your diagram: answer the following questions based on the data below under the assumptions of the. Note that the data describe a leontief production technology.
