Suppose Italian workers can produce 4 cars per year and German workers can produce 8 cars per year. Suppose Italian workers can produce 5 tons of garments per year and German workers can produce 6 tons of garments per year. Trade between Italy and Germany would lead to? a. Employment gains in Italian car manufacturing b. Exports of cars from Germany to Italy c. Lower relative price of cars in Germany d. Lower relative price of garments in Italy

Suppose Italian workers can produce 4 cars per year and German workers can produce 8 cars per year. Suppose Italian workers can produce 5 tons of garments per year and German workers can produce 6 tons of garments per year. Trade between Italy and Germany would lead to? a. Employment gains in Italian car manufacturing b. Exports of cars from Germany to Italy c. Lower relative price of cars in Germany d. Lower relative price of garments in Italy

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter9: Application: International Trade

Section: Chapter Questions

Problem 2QR

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