Why have so many regional trade arrangements among developing countries failed? Why might MERCOSUR have a better chance for success than the East African Common Market?
What will be an ideal response?
Early attempts at regional trade arrangements such as the East African Common Market have failed because markets have been small and countries had similar economies, limiting the gains to be had from comparative advantage. MERCOSUR has been created at a time when the countries involved have large, more diversified markets.
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C = $5 million + 0.9(1 - 0.1)Y I = $7 million G = $6 million NX = $1 million Based on the above data, the value of the expenditure multiplier is
A) 1.23. B) 5.26. C) 9.09. D) 11.11.
Positive externalities can be dealt with by _____ them
a. subsidizing b. taxing c. regulating d. encouraging
Most economists believe that there are positive externalities in education. One can conclude that a free market would fail to give the socially optimal outcome because the equilibrium:
a. price and quantity would be too high. b. price would be too low and quantity would be too high. c. price and quantity would be too low. d. price would be too high and quantity would be too low. e. price and quantity would be just right.
According to the information in the table shown, if someone were earning $20,000 in Mexico, approximately what would he need to earn in the United States to enjoy the same amount of goods and services?
This table shows the price-level adjustment as compared to the United States.
A. $30,303
B. $35,000
C. $20,030
D. $15,000