Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The 2 goods are washers (drawn on the vertical axis) and dryers (drawn on the horizontal axis). In the country of Dreamland, the slope of
The 2 goods are washers (drawn on the vertical axis) and dryers (drawn on the horizontal axis). In the country of Dreamland, the slope of the autarky relative price line is 1.5. In the country of Wonderland, the slope of the autarky relative price line is 2.5. As countries move from autarky to trade, the relative price of Dryers _____ in Dreamland and ____ in Wonderland.
a. rises; rises
b. falls; falls
c. falls; rises
d. rises; falls
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started