2 assignments due in a week. Written by hand and take pictures go through the instructions before you start EVERYTHING MUST BE FROM TEXTBOOK AND USE CRITICAL AND LOGICAL THINKING

Assignment 2 – Due: ______________

1. Do chapter 3 summary, done by hand with diagrams included if not already completed.

Answer these questions briefly. Use diagrams where appropriate.

1. What are (factor) endowments? What are some examples?

2. What is comparative advantage? How do we know if it exists?

3. What are some of the sources of comparative advantage?

4. What is absolute advantage? How do we measure it?

5. What is specialization? Why does it increase productivity?

6. What are gains from trade? Give an example to show you understand what they are.

7. How could comparative advantage be “acquired”?

Answer these problems

1. Do questions 2.3 page 54 of the text. Note that there is in an error in the question as it relates to the Figure 2.4 on page 43, not page 37.

2. Do question 2.6 page 55 from the textbook. Draw the PPF for each country on a graph in answering your question. Also draw a combined PPF for the two countries.

3. Why would a trading agreement, such as the TransPacific Partnership (TPP), be of benefit to all the countries, even though they have very different levels of productivity and economic structures?

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