Concepts and Definitions

1)In the monetized version of the Ricardian framework, what is the export condition that determines the basis of trade?

2)Graph and explain using the Ricardian model: Consumption gains from trade, Production gains from Trade. Assume that the country is producing only goods X and Y, and that the international relative price of X is lower than the domestic relative price of X.

3)Define Mercantilism and use the Mercantilist theory to justify the role of the government in the economy. Provide examples of regulations that illustrate this.

4)Define the Stolper-Samuelson Theorem.

5)Describe the Leontieff Paradox: name the model being tested and the test performed then explain the paradox.