< Back Assignment details Business in the Globalised Economy (2210)
tal,Mb I IUN A.1
If a country closes off to trade and notices that the number of firms in an industry doubles in size, what economic theory would help us explain this phenomenon?
A. Stolper-Samuelson. B. Melitz. C. Ricardian. D. Cournot. (1 mark)
Explain your answer in up to 200 words and using a diagram
In the Pure Specific Factors model with two sectors, Cars (C) and Wheat (W), Capital (K) is specific to C and Land (A) is specific to W. If the government imposes a tariff on the imports of W then
A. Both owners of K and owners of A will benefit. B. Owners of A will benefit. C. Owners of K will benefit. D. Neither owners of K nor owners of A will benefit.
Explain your answer in up to 200 words and using a diaaram
number of firms in an industry doubles