4.1 Benefits of international trade

Using Figure 6, identify the equilibrium price when Country B engages in free trade.

Using Figure 6, calculate the consumer surplus and the producer surplus when Country B engages in free trade.

Using information from the text/data and your knowledge of economics, evaluate the view that free trade is beneficial to Japan’s economy.

Define the term absolute advantage indicated in bold in the text (paragraph [3]).

Define the term free trade indicated in bold in the text (paragraph [1]).

Using the information in Figure 1, calculate the change in the value of Burundi’s gold exports resulting from the increase in the price of gold from US$1500 per oz to US$1800 per oz.

Using Figure 6, identify the equilibrium price when Country B engages in free trade.

Using Figure 6, calculate the consumer surplus and the producer surplus when Country B engages in free trade.

Using Figure 6, identify the equilibrium price when Country B engages in free trade.

Using Figure 6, calculate the consumer surplus and the producer surplus when Country B engages in free trade.

Using information from the text/data and your knowledge of economics, evaluate the view that free trade is beneficial to Japan’s economy.

Using information from the text/data and your knowledge of economics, evaluate the view that free trade is beneficial to Japan’s economy.

Define the term absolute advantage indicated in bold in the text (paragraph [3]).

Define the term absolute advantage indicated in bold in the text (paragraph [3]).

Define the term free trade indicated in bold in the text (paragraph [1]).

Define the term free trade indicated in bold in the text (paragraph [1]).

Using the information in Figure 1, calculate the change in the value of Burundi’s gold exports resulting from the increase in the price of gold from US$1500 per oz to US$1800 per oz.

Using the information in Figure 1, calculate the change in the value of Burundi’s gold exports resulting from the increase in the price of gold from US$1500 per oz to US$1800 per oz.

Using the diagram, calculate the opportunity cost of producing one tonne of bananas in Country A.

Define the term comparative advantage indicated in bold in the text (paragraph [5]).

Sketch and label a diagram to illustrate comparative advantage between Country X and Country Y on Figure 4.

Figure 4

Outline the reason why Country X should specialize in the production of apples and Country Y should specialize in the production of bananas.

Plot and label the production possibility curves for Country J and for Country H, assuming constant opportunity costs, on Figure 4.

Define the term absolute advantage indicated in bold in the text (paragraph [3]).

Using a production possibilities curve (PPC) diagram to illustrate comparative advantage, explain why the EU would export cars to Indonesia and Indonesia would export clothing to the EU (paragraph [2]).

Countries often specialize and trade according to the theory of comparative advantage. Explain the limitations of this approach.

Using a production possibilities curve (PPC) diagram to show comparative advantage, explain why Vietnam would export seafood to Japan while Japan would export machinery to Vietnam (Text B, paragraph [1]).

Sketch and label a diagram to illustrate comparative advantage between Country X and Country Y on Figure 4.

Figure 4

Outline the reason why Country X should specialize in the production of apples and Country Y should specialize in the production of bananas.

Sketch and label a diagram to illustrate comparative advantage between Country X and Country Y on Figure 4.

Figure 4

Outline the reason why Country X should specialize in the production of apples and Country Y should specialize in the production of bananas.

Plot and label the production possibility curves for Country J and for Country H, assuming constant opportunity costs, on Figure 4.

Plot and label the production possibility curves for Country J and for Country H, assuming constant opportunity costs, on Figure 4.

Define the term absolute advantage indicated in bold in the text (paragraph [3]).

Define the term absolute advantage indicated in bold in the text (paragraph [3]).

Using a production possibilities curve (PPC) diagram to illustrate comparative advantage, explain why the EU would export cars to Indonesia and Indonesia would export clothing to the EU (paragraph [2]).

Using a production possibilities curve (PPC) diagram to illustrate comparative advantage, explain why the EU would export cars to Indonesia and Indonesia would export clothing to the EU (paragraph [2]).

Countries often specialize and trade according to the theory of comparative advantage. Explain the limitations of this approach.

Countries often specialize and trade according to the theory of comparative advantage. Explain the limitations of this approach.

Using a production possibilities curve (PPC) diagram to show comparative advantage, explain why Vietnam would export seafood to Japan while Japan would export machinery to Vietnam (Text B, paragraph [1]).

Using a production possibilities curve (PPC) diagram to show comparative advantage, explain why Vietnam would export seafood to Japan while Japan would export machinery to Vietnam (Text B, paragraph [1]).

Using the diagram, calculate the opportunity cost of producing one tonne of bananas in Country A.

Using the diagram, calculate the opportunity cost of producing one tonne of bananas in Country A.

Define the term comparative advantage indicated in bold in the text (paragraph [5]).

Define the term comparative advantage indicated in bold in the text (paragraph [5]).

Countries often specialize and trade according to the theory of comparative advantage. Explain the limitations of this approach.

Countries often specialize and trade according to the theory of comparative advantage. Explain the limitations of this approach.

Countries often specialize and trade according to the theory of comparative advantage. Explain the limitations of this approach.