We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Macro and Microeconomics: International Trading - Assignment Example

Comments (0)
MACRO AND MICROECONOMICS: INTERNATIONAL TRADING Date Reduction of unemployment by enacting tariff on imports This argument in the statement is indeed a fact. Unemployment by definition is the situation where by the resources of a given economy are not fully utilized…
Download full paper
Macro and Microeconomics: International Trading
Read TextPreview

Extract of sample
Macro and Microeconomics: International Trading

Download file to see previous pages... It must be noted that the importing countries do not always employ the citizens of the country they are in business with. Therefore, when the local industries close down due to external competition, there would be high levels of unemployment. US have faced completion from countries like China and Japan in the automobile industry. This has always seen US increasing its importation from China. For an economy to develop, a country should encourage exportation and reduce importation. This aspect would result into good terms of trade and surplus balance of payment. It is salient to note that enactment of tariffs would bar importers from importing good into the country and therefore protecting the local industries. The protected industries would therefore expand to create employment for the citizens. Concisely, the economy needs to be independent to give chance to local industries to develop and compete. A country should use its revenue in developing local industries rather developing another country by consuming their products. This will reduce unemployment with a bigger percentage (Carbaugh 2008). Effects of tariffs on welfare of small and large countries It is the ultimate truth that tariffs have more negative effects on welfare of large countries than on small countries. In a given country, the tariff would affect the welfare of consumers, producers and the government. The welfare of the three groups constitutes the aggregate welfare of an economy or a country. Let us first analyze the effects of tariffs on the larger country. Consumers in an exporting country will suffer a reduction in well being because of the tariffs. The increase in the domestic price of the imported goods reduces the consumer surplus in the market. In a small country, this reduction will be small since the smaller country imports less goods. The bigger country will experience larger reduction in well being. The producers in the importing countries would experience an increase in well being because of the tariff. (IMF 1998) This is due to increase in the prices of the products that consequently increase the producer surplus. In small country, this surplus would be smaller than large country since the small country will imports fewer goods than larger country. The importing country would benefit from the tariff since it uses it as revenue. The aggregate welfare effect of the country is the found by summing the gains and losses to consumers. Whenever a large country implements a small tariff, it will raise its national income. On the other hand, a small country still experience national welfare, but the welfare gain will be smaller as compared to that of a bigger country. This is because a smaller country has few consumers and importers due to its small size. This will result into larger welfare benefit. Since the larger country has many consumers and producers, the total welfare will be higher. (IMF 1998) Implement tariffs on automobiles equal to the difference between US and Mexican wage rates It is true note that automobiles are out sourcing to Mexico due to presence of cheap labor there. It is also true to suggest that for US to counteract this situation, it must impose tariffs on automobile imports that is equivalent to the difference between the US and Mexican wage rates. This would create a balance between producers in US and the producers in Mexico. It will ensure ...Download file to see next pagesRead More
Comments (0)
Click to create a comment or rate a document
MicroEconomics Unit1
This means that she has to sacrifice the opportunity of producing 50 pigs if she wants to produce 200 pounds of corn per year. But if she choose to produce pigs, the opportunity cost that she will incur will be 4 pounds of corn (200 pound of corn/50 pigs).
3 Pages(750 words)Assignment
Therefore, eliminating taxes would prevent the government from reaching its desired revenue targets and this would result in a deficit between what the government spends and what it collects. Ans 2) A private good is one that is excludable in nature and is unique for every consumer.
3 Pages(750 words)Assignment
Macro and Microeconomics
Therefore, if the price of the shirt is 220 francs, the price of the shirt in dollars is calculated as follows. 1 dollar = 5.5 francs Dollar price of shirt = 220 francs Using the principle of cross-multiplication, Price of shirt in dollars = (220 francs x 1dollar)/5.5 francs = 40 dollars Question two Supposing that a Frenchman wants to import a new Chrysler Neon costing 14,300 dollars and the prevailing exchange rate is 5.5 francs/dollar, the franc price of the car can be determined.
4 Pages(1000 words)Essay
Macro & Microeconomics Questions
This type of assumed Gross Domestic Product is often referred to as potential gross domestic product and is often presented in budget statements (Thoma, 2012). It has however not always turned out that the potential gross domestic product values are achieved.
4 Pages(1000 words)Assignment
The rate of unemployment in Germany has been around 5.4 percent by end of 2012. This is because the demand for labour is a derived demand and the low demand for German products from its 17 Euro countries. This is because of crisis in other parts of German markets such as Cyprus.
4 Pages(1000 words)Assignment
MAcro R
To illustrate these concepts, this paper selectively, discusses the case study of UK national unemployment rate, causes and effects of inflation on the country economy. Unemployment According to the trading economic website, tradingeconomics.com, unemployment rate in the United Kingdom remained unchanged at 7.70 percent in August of 2013 from 7.70 percent in July of 2013.
3 Pages(750 words)Assignment
Applying utility function in investing enables the investor to understand the usefulness of investing in various securities as opposed to diverse ones. For example, fixed
3 Pages(750 words)Assignment
These pose great dangers not only to the economy but also to the social and political world. Unemployment is an important issue of macroeconomic issue. This is where majority of the people in a country have no jobs. Unemployment could either be voluntarily or
1 Pages(250 words)Assignment
Similarly if he spends his entire budget on food then he will be able to consume 0 unit of water and 4 unit of food. The table below shows that how the consumer is able to allocate his budget on food and water.
8 Pages(2000 words)Assignment
us, as beef price increases and since the customers are price sensitive, the demand will decrease as the consumers will resort to consuming chicken since they lower priced. The consumers will thus reduce consumption of beef and increase consumption of chicken. The supply of
4 Pages(1000 words)Assignment
Let us find you another Assignment on topic Macro and Microeconomics: International Trading for FREE!
Contact us:
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us