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Consider a small open economy that produces computers and textiles. The world price of computers is greater than the country's autarky price of computers and
Consider a small open economy that produces computers and textiles. The world price of computers is greater than the country's autarky price of computers and the world price of textiles is less than the county's autarky price of textiles. Free trade will 0 Increase the consumer surplus of foreign textile consumers 0 Increase the producer surplus of domestic textile producers 0 None of the other options 0 Increase the consumer surplus of domestic computer consumers Suppose Australia has an annual ination rate of 6% and the annual inflation rate in the Eurozone is 6%. If PPP holds, what is the annual growth rate of the nominal exchange rate, expressed in euros per Australian dollar? 0 6% 0 None of the other options 0 12% 00%
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