10.Consider the, so called,New Trade Modelswith homogenous products and external economies of scale. These models suggest that:

Group of answer choices

established advantage is not as important as comparative advantage.

even countries that have comparative advantage may not be leading exporters until they establish their advantage.

countries with comparative advantage may establish their advantage by producing even a small amount of output.

11. Suppose that other countries do not respond to the US commercial policies on tariffs and subsidies. A tariff imposed by the United States government on imports from the rest of the world is expected to _______ its terms of trade. A subsidy provided by the United States government to American firms is expected to ______ its terms of trade.

Group of answer choices

have no effects on; improve

improve; have no effects on

improve; deteriorate

deteriorate; improve

have no effects on; have no effects on

12.Suppose that other countries do not respond to the Paraguay's commercial policies on tariffs and subsidies. A tariff imposed by the Paraguay's government on imports from the rest of the world is expected to _______ its terms of trade. A subsidy provided by the Paraguay's government to American firms is expected to ______ its terms of trade.

Group of answer choices

improve; deteriorate

deteriorate; have no effects on

have no effects on; deteriorate

have no effects on; have no effects on

deteriorate; improve