Suppose Australia, a Land (K)-Abundant Country, and Sri Lanka, a Labor(L)-Abundant

question 66

Essay

Suppose Australia, a land (K)-abundant country, and Sri Lanka, a labor(L)-abundant country, both produce labor and land intensive goods with the same technology.

-Refer to above figure. Imagine that the relative capital abundance of Australia was so much greater than that of Sri Lanka, that we would have to locate Australia far to the right on the K/L axis. If this were so far to the right that there was no area of overlap on the w/r axis, then what product would Australia export?
Which product will each of the trade partners export?
Will the relative wages as calculated now be the same or different in both Australia and Sri Lanka?

Recognize the importance of considering extreme values when analyzing data.

Explain the concept of variation and its measures (range, standard deviation).

Understand the relationship between central tendency and variation.

Differentiate between descriptive and inferential statistics.

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Definitions:

Flynn Effect

The observed rise over time in standardized intelligence tests scores, attributed to various factors including improved nutrition and education.

Ethnic Groups

Categories of people who identify with each other based on common ancestral, social, cultural, or national experiences.

Decades

Periods of ten years, often used as a measure of time to note changes, trends, or developments.

Mean IQ Scores

The average score derived from standardized intelligence testing, used as an indicator of relative intelligence across a population.