gelp mi

TRADE AND MIGRATION This question explores migration in a two-good Heckscher-Ohlin model. Supposed we have a country (Home) that is endowed with capital K and labor L. It can produce two goods, clothing (C) and food (F) using its K and L endowment. It takes 4 units of labor and 2 unit of capital to make food; and it takes 2 units of labor and 5 units of capital to make clothing. Capital and labor are complements in production of both goods. Home has 160 units of labor and 20 units of capital, while Foreign has 120 units of labor and 120 units of capital. In summary, we have the following information: Technology: Factor Endowments: alf = 4 akr = 2 Home: L = 160; K = 20 aLc = 2 ake = 5 Foreign: L* = 120; K* = 120 10. Given the information above, show which country is capital abundant and which country is labor abundant. Show which good is capital intensive and which good is labor intensive. Which product will Home export? Which product will Foreign export? 1 1. Now suppose that Foreign is closed to trade but experiences an increase in the labor force through immigration from the Home country. This results in "biased" growth. Biased towards which sector? What happens to the relative price of clothing in the Foreign country? Does this change conform to the Rybczynski's Theorem? Explain.TRADE AND MIGRATION This question explores migration in a two-good Heckscher-Ohlin model. Supposed we have a country (Home) that is endowed with capital K and labor L. It can produce two goods, clothing (C) and food (F) using its K and L endowment. It takes 4 units of labor and 2 unit of capital to make food; and it takes 2 units of labor and 5 units of capital to make clothing. Capital and labor are complements in production of both goods. Home has 160 units of labor and 20 units of capital, while Foreign has 120 units of labor and 120 units of capital. In summary, we have the following information: Technology: Factor Endowments: alf = 4 akr = 2 Home: L = 160; K = 20 aLc = 2 ake = 5 Foreign: L* = 120; K* = 120 10. Given the information above, show which country is capital abundant and which country is labor abundant. Show which good is capital intensive and which good is labor intensive. Which product will Home export? Which product will Foreign export? 1 1. Now suppose that Foreign is closed to trade but experiences an increase in the labor force through immigration from the Home country. This results in "biased" growth. Biased towards which sector? What happens to the relative price of clothing in the Foreign country? Does this change conform to the Rybczynski's Theorem? Explain.1. Consider the monopolist from the last problem set who is serving two types of consumers with demand functions. Let c(y) = 0: Di(p.k) = 2-p keep 0 Otherwise Du(p.k) = 4 -p k 20 D(P) = 100/p p $ 20 (a) What is the profit-maximizing choice of output? (b) If the government could set a price ceiling on this monopolist in order to force it to act as a competitor, what price should they set? (c) What output would the monopolist produce if forced to behave as a competitor? 4. A monopolist has a cost function of c(y) = cy so that its marginal costs are constant at Sc per unit. The monopolist is operating at an output level where lel = 3. The government imposes a quantity tax of $6 per unit of output. (a) If the monopolist is facing linear demand curve, how much does the price rise? (b) If the monopolist has constant elasticity, how much doe the price rise? 5. * An economy has two kinds of consumers and two goods. Type A consumers have utility function UA(31, 12) = 47 -(#)+12 and Type B consumers have utility function Up(21, 12) = 21 - (2)+12. Consumers can only consume nonnegative quantities. The price of good 2 is 1 and all consumers have incomes of 100. There are N type A consumers and N type B consumers. (a) Suppose that a monopolist can produce good 1 at a constant unit cost of c per unit and cannot engage in any kind of price discrimination. Find its optimal choice of price and quantity. For what values of c will it be true that it chooses to sell to both types of consumers? (b) Suppose that the monopolist uses a "two-part tariff" where a consumer must pay a lump sum k in order to be able to buy anything at all. A person who has paid the lump sum & can buy as much as he likes at a price p