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Questions and Answers
The terms of trade refer to the ratio at which a country can exchange its exports for imports.
True
Offer curves are used to determine the equilibrium price at which trade takes place in international economics.
True
The equilibrium-relative commodity price at which trade will take place can be determined using both partial and general equilibrium analysis.
True
Partial equilibrium analysis considers the impact of a policy on a single market, holding all other markets constant.
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In Figure 4-1, at a relative price greater than P1, Nation 1's excess supply of X gives rise to Nation 1's international supply curve of X.
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