Answer the following questions with specific explanations.

D Question 5 1 pts Compared to a large country, in a model of monopolistic competition, welfare of consumers in a smaller country is: O lower O higher O the same O not determined D Question 6 1 pts Wages for workers and researchers are higher in the US than in Mexico. At the same time, the gap between the wages of blue-collar workers and higher-skilled researchers is larger in Mexico. In case the costs of offshoring are neither too high, nor too low, you would expect that O The US will specialize in low skill intensive tasks, and Mexico will specialize in high skill intensive tasks O Mexico will perform all tasks The US will specialize in high skill intensive tasks, and Mexico will specialize in low skill intensive tasks O the average skill intensity of tasks performed in the US and Mexico will be similar D Question 7 1 pts Consider the case of multinational production where Romania is specializing in the production of components and France is specializing in R&D. An increase in the world price of components will O increase the output of French firms O benefit French consumers O increase unemployment in Romania O decrease the output of French firms