Econ0007: Tutorial 2 (Non-assessed)
The purpose of this homework, which does
not
account towards your final mark, is to prepare you for the Moodle quiz. You need to submit your answers to these questions in Moodle
a day before your tutorial
. For instance, if your tutorial is Wednesday 15:00, then your deadline is Tuesday 23:59. Submit your answers in a world file. How to name your submission file? If your candidate number is BSMX5 and you are in tutorial B, please name your submission file as “TB-BSMX5”. Although not marked, we will treat your homework submissions as evidence of your engagement with this module.
Part 1: Multiple choice questions.
You will receive 2 marks for each correct answer and 1 mark will be subtracted from your score for each incorrect answer. If you do not answer a question, you will receive zero marks for that question.
A1. Which of the following options is among the factors that determines trade specialisation according to the Heckscher Ohlin Model?
A. Differences in production experience
B. Differences in real interest rates
C. None of the above
A2. Which of these statements is correct?
A. Under free trade, Heckscher Ohlin model predicts a fall in global income inequality in the long term
B. Under free trade, Heckscher Ohlin model predicts a rise in global income inequality in the long-term
C. None of the above
A3. Which of these statements is correct?
A. Under free trade, Heckscher-Ohlin model predicts a rise in income inequality within rich countries
B. Under free trade, Heckscher-Ohlin model predicts a rise in income inequality within developing countries
C. None of the above
A4. Which of these options are among the losers of trade liberalisation, according to the Heckscher Ohlin model?
A. Computer programmer in Ethiopia
B. Unskilled shoe producers in Ethiopia
C. None of the above
A5. Which of these options are among the winners of trade liberalisation, according to the New Trade Theory?
A. Bondholders in Germany
B. Unskilled workers in Germany
C. None of the above
A6. Which of these statements is correct?
A. New Trade Theory is able to explain the concentration of trade in just few regions
B. New Trade Theory is able to explain inter-industry trade
C. None of the above
A7. Which of these statements is correct?
A. New Trade Theory assumes downward supply curves for firms.
B. New Trade Theory assumes homogenous production technology across countries.
C. None of the above
A8. Which of these options are among the assumptions of Heckscher-Ohlin model?
A. Composition of the consumption basket is the same in the two countries
B. Constant return to capital
C. None of the above
A9. Based on the shown figure, which of these statements is correct?
A. The data for China is consistent with New Trade Theory.
B. The data for Japan is consistent with Heckscher-Ohlin model.
C. None of the above.
Source: World Bank Development Indicators.
A10. You can find the data on Saudi Arabia’s export basket
here
. Based on that data, which of these options is correct?
A. Saudi Arabia’s export basket is consistent with Heckscher-Ohlin model.
B. Saudi Arabia’s export basked is highly diversified.
C. None of the above.
Part B: Short questions.
You need to answer both questions. To do so, you
often
need to rely on the material covered in the lectures, tutorials, and readings.
The labour’s share of income has been declining in the US in the past four decades. Is this trend consistent with the predictions of Heckscher-Ohlin Model? (Word limit: 250 words)
Can New Trade Theory help us predict the pattern of horizontal intra-industry trade among countries? Explain. (Word limit: 250 words)