Task: As an international economist you have been asked to prepare a short speech which answers the following questions:
Question 1. How does the Heckscher-Ohlin theory differ from Ricardian theory in explaining international trade patterns?
Question 2. The Heckscher-Ohlin theory demonstrates how trade affects the distribution of income within trading partners. Explain.
Question 3. How does the Leontief paradox challenge the overall applicability of the factor-endowment model?
Question 4. According to Staffan Linder, there are two explanations of international trade patterns?one for manufacturers and another for primary (agricultural) goods. Explain.
Following that speech, the audience asks you to respond to the following question:
Describe a specific tariff, an ad valorem tariff, and a compound tariff. What are the advantages and disadvantages of each?