In Question #25 Above

question 9

Multiple Choice

In Question #25 above,

• A) a post-trade price ratio (terms of trade) of 1 shirt:0.75 machine is a feasible post-trade price ratio.
• B) a post-trade price ratio (terms of trade) of 1 machine:0.6 shirt is a feasible post- trade price ratio and it would give all the gains from trade to France.
• C) a post-trade price ratio (terms of trade) of 1 machine:0.55 shirt is a feasible post-trade price ratio and both countries would gain from trade at that price ratio.
• D) other things equal, if world demand for shirts is much greater than world demand for machines, then the post-trade price ratio (terms of trade) will tend to settle toward or be located at 1 shirt:0.6 machine rather than settle toward or be located at 1 shirt:0.5 machine.

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Definitions:

Voluntary Adherence

The act of willingly following or committing to a policy, rule, or guideline.

Reference Group

Kelley’s term for a group that is psychologically significant for our behaviour and attitudes.

Private Change

A modification in a person's thoughts, feelings, or behaviors that occurs internally and is not immediately observable to others.

Social Influence

Process whereby attitudes and behaviour are influenced by the real or implied presence of other people.