ECON 441 Final: Final Exam Fall 2002
Document Summary
The questions are worth a total of 90 points, as indicated. You will have 120 minutes to complete the exam: [18 points] the figure on the next page shows domestic demand and supply curves for a country. (the same figure appears twice on the page, for your convenience. ) It is repeated so that if it gets too cluttered, you can start again. Feel free to tear off page 1 of the exam so that you can look at it alongside the figure. Page 3 of 4: [24 points] consider a small economy, initially in autarky, in a world where there are two goods that can be produced, food and cloth. The relative price of food in the country in autarky is lower than the relative price of food on the world market. Suppose that the country now opens to free international trade. Prices with free trade are such that there exist two cones of diversification.
