QUESTION 14 A small country can import a good at a world price of 5 per unit. The domestic supply curve is: S = 10 + 10P The demand curve is: D = 600 - 10P In addition, each unit of production yields a marginal social benefit of 10. d. What would the optimal subsidy be? 0 5 O 10 O 15 O 20 QUESTION 15 Which of the following aspects, as per the article "Gains from Trade When Firms Matter" by Melitz and Trefler JEP 2012 , does NOT give rise to gains from trade ? O factor mobility to most productive firms O productivity gain through innovation in export industries O firm heterogeneity in exporting sector O innovation in import competing industries QUESTION 16 ABernard, Jensen, Redding, and Schott, in their 2007 JEP article "Firms in International Tade" conclude that of the 5.5million active US manufacuring firms in 2002 O the few firms that dominate U.S. exports are large in size in part because they produce and export multiple products to multiple countries O nonexporters are systematically more productive than exporters O exporting is less likely and export intensity is lower in more skill-intensive sectors O approximately 38% of all manufacturing firms engage in export trade QUESTION 17 In the Mayer and Ottaviano 2008 Intereconomics article "The Happy Few: The Internationalisation of European Firms New Facts based on Firm-level Evidence" they mention O a small number of highly productive firms corner a big share of a country's international exports O exporting firms are bigger and generate higher value added because they pay lower wages, employ more labour per capital and more unskilled workers having higher productivity. O importing firms are bigger and generate higher value added because they pay higher wages, employ more capital per labour and more skilled workers having higher productivity. O a large number of highly productive firms corner a big share of a country's international exports