Please help me finish 6 questions in the file. No Plagiarize.Thank you!
international_trade.docx
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Watch this video on international trade and then answer the following questions.
https://www.youtube.com/watch?v=omX2rM-yDKQ&feature=youtu.be
1) Explain how the United States, being a large economy with an abundance of natural resources, labor,
and capital, can benefit by not being in autarky.
2) It was shown in the video that the United States had the comparative advantage in burgers. Using the table
below, show and explain how Mexico has the comparative advantage in phones.
Mexico
Possibility
Burgers
United States
Phones
Burgers
Phones
A
6
0
12
0
B
4
8
8
8
C
2
16
4
16
D
0
24
0
24
3) From your answer in the previous question, what is the opportunity cost of burgers for the United
States, i.e. how many burgers must the United States give up to produce one phone? What would be an
agreeable terms of trade for 1 phone?
4) At the end of the video, a supply and demand graph of the phone market for both countries was
shown. Explain why Mexico exported phones to the United States.
5) Suppose, the market for burgers was shown rather than the market for phones in the supply and demand
graphs. For the United States to export burgers and Mexico to import burgers, what would world price need to
be, in each country, relative to the domestic price?
6) Lastly, explain what a tariff is and the effect it can have on burger imports for Mexico.
…
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