Name: Roll Number: Room No: Class: IB1610: Student Information [PDF]

Zitiervorschau

Student Information

Name: Room No:

NGÔ THỊ THÚY HIỀN

Roll number: Class:

HS163468 IB1610

FOR TEACHER ONLY MARK

MARKED BY (NAME AND SIGNATURE)

Signature of Proctor

ECO121_Test 01_Individual Assignment 01 Question1. (2 points) 1. a. What is defined as absolute advantage? Absolute advantage is the ability to produce a good using fewer inputs than another producer b. What is defined as comparative advantage? Comparative advantage is the ability to produce a good at a lower opportunity cost than another producer c. Case 1: Output approach Two commodities and two countries Given the resources, Singapore and Malaysia can produce the following products – television sets and cars (see Table 01) Countries TV sets Cars (units) Singapore 100 50 Malaysia 60 40 Table 01 + Which country has the absolute advantage in the production of both TV sets and Cars over the other? In the same amout of resourse, Singapore produce more both TV sets and Car than Malaysia. (100>60 ; 50>40) So Singapore use less input than Malaysia. In short, Singapore has the absolute advantage in the production of both TV sets and Cars + Which country has the comparative advantage either in the production of TV sets or in the production of Cars over the other? Cars In Singapore, instead of producing 1 car, they can produce 2 TV set In Malaysia, instead of producing 1 car, they can produce 1.5 TV set

-> The opportunity cost in production of cars in the Malaysia is less than Singapore. So Malaysia has the comparative advantage in production of Cars TV set In Singapore, instead of producing 1 TV set, they can produce 0.5 cars In Malaysia, instead of producing 1 TV set, they can produce 0.6 cars -> The opportunity cost in production of TV set in the Singapore is less than Malaysia. So Singapore has the comparative advantage in production of TV set d. Case 2: Input approach Two commodities and two countries Give the resources, America and England can produce one unit for both Steel and Coal in terms of number of working hours shown as follows: Countries One unit of Steel One unit of Coal required required America 80 man-hours 90 man-hours England 120 man-hours 100 man-hours Table 02 + Which country should specialize in the production of Steel? In the production of Steel, England has comparative advantage higher than America. So England specialize in the production of Steel + Which country should specialize in the production of Coal? In the production of Coal, America has comparative advantage higher than England. So America specialize in the production of Steel e. Case 3: Input approach Two countries but multiple commodities The following Table 03 shows the numbers of man – days taken to produce an equivalent amount of six commodities in each of the two countries – Switzerland and Sweden. Countries Coal Cotton Wool Iron Wheat Maize Switzerland

120

60

70

100

140

80

Sweden

100

25

35

90

90

20

Table 03 + Assuming that there are no other costs of production. Which two commodities is Sweden most likely to import from Switzerland? Two commodities is Sweden most likely to import from Switzerland: Cotton and Maize Question 2 (3 points): Suppose there is an economy that produces only two goods: tequila and peyote. In 2008, the economy produced 100 litres of tequila and 200 peyote plants. The unit prices (per litre or per plant) in 2008 were $100 and $500. 1000 people were employed in the tequila sector, and the peyote sector employed 500. In 2009, the weather was particular sunny and hot, which is good for tequila production but bad for the cultivation of peyote. As a result, the economy produced 120 litres of tequila but only 191 peyote plants in 2009.

The tequila and peyote sold for $90 per litre and $550 per plant that year. 1100 people were employed in the tequila sector, while only 450 people worked in the peyote sector. Answer the following questions: a. How much is Nominal GDP in 2008 and 2009? What is the percentage change? 2008 : $100 x 100 + $500 x 200= $110.000 2009: $90 x 120 + $550 x 191= $115850 Percentage change: (115850-110000): 110.000= 5.32% b. How much is Real GDP in 2008 and 2009, by considering 2008 as the base year? What is the percentage change? 2008: $100 x 100 + $500 x 200= $110,000 2009: $100 x 120 + $500 x 191 = $107,500 Percentage change: (110000-107500) : 110000 = -2,27% c. How much is the GDP deflator in the two years? By what percentage does the price level change from the base year to 2009? 2008: 100 2009: 108,2  price level change from the base year to 2009 is 8,2% d. What was the growth rate of average labour productivity for the whole economy between 2008 and 2009? In 2008: 11.0000 : (1000 + 500) = $73.33 per worker In 2009: 10.7500 : (1100 + 450) = $69.35 per worker the growth rate of average labour productivity is  (69.35-73.33) : 73.33 = -5.43% Question 3 (2 points) In the country of Kwaki, people produce canoes, fish for salmon, and grow corn. In one year they produced 5000 canoes using labor and natural materials only, but sold only 4000, as the economy entered a recession. The cost of producing each canoe was $1000, but the ones that sold were priced at $1250. They fished $30 million worth of salmon. They used $3 million of the salmon as fertilizer for corn. They grew and ate $55 million of corn. What was Kwaki's GDP for the year? Cost of 1000 canoes in inventory : 1000 x $1000 = $1000000 Cost of 4000 canoes: 4000 x $1250 = $5000000 Cost of fish for salmon: $27 million Cost of grow corn : $55million  Kwaki's GDP for the year: $88 million Question 4. (3 points) + What are the benefits/gains from international trade? Write an essay with 500 words and provide your answers with real example in the context of Vietnam international trade relations The emergence of the global economy was aided by international trade. Global events influence and are influenced by supply and demand, and consequently prices, in the global economy. For a developing economy like Vietnam, international trade brings a lot of benefits. The first benefit of international trade is that it generates a lot of job opportunities. This situation will surely help countries reduce their unemployment rates. The next benefit of foreign commerce is that it broadens the market for the company. This is accomplished by producing to one's best ability without concern of overproduction or decreased sales pricing.

In this case, high productivity will boost earnings. Another benefit of international trade is the establishment of positive inter-country connections. Positive contacts will surely develop between the participating countries. After then, the country can participate in other sorts of cooperation. International trade also contributes significantly to a country's economic growth. This is because countries with both the advantages and disadvantages of a product can sell and obtain the things they desire. International trade activities will meet demand while also boosting the amount of money available. A gain in state income will boost a country's economy in this way. International trade will also make it easier for each country to address its demands that are not met by domestic production. Since each country needs its unique richness of resources. Starting with geographical conditions, climate, scientific and technological mastery…. This can be further improved by each country developing its items. 2019 is another year with numerous excellent accomplishments for Vietnam's trade in the setting of the emergence of trade disputes between major nations across the world. As a result, the total value of products imported and exported reached a new high of 516.96 billion USD. The trade balance of goods recorded a trade surplus of $9.9 billion, the highest ever, and significantly greater than the $2.1 billion trade surplus in 2017. In general, overall registered capital, freshly registered capital, extra capital, and contributed capital to acquire foreign investor shares totaled 38.02 billion USD in 2019, up 7.2 percent from the same period last year. In 2019, foreign investors poured money into 19 industries/fields in Vietnam, with the processing and manufacturing business receiving the most money. In this area, total investment capital reached 24.56 billion dollars, accounting for 64.6 percent of total registered investment capital. With a total investment capital of 3.88 billion USD, real estate is the second most popular investment option, accounting for 10.2 percent of total registered investment capital. The wholesale and retail industry is in the third position... + What are the disadvantages of international trade? Write an essay with 500 words and provide your answers with real example in the context of Vietnam international trade relations International trade has so many advantages, made simple to ship goods or provide services to people in over the world. Overnight delivery, e-commerce, language interpreters, and established global marketplaces are now available to businesses of all sizes. However, if your company is to be truly successful in these countries, you may need to overcome certain international trade challenges. Shipping packages practically anywhere in the globe is simple with international shipping businesses. However, one of the drawbacks of international trade is that the majority of these destination nations' customs authorities levy additional costs on commodities sent to them. While each country sets its tariffs and taxes, they are usually based on the value of the goods being shipped (item, insurance plus shipping). A corporation must know what the end customer will be paid by the overseas shipping provider in addition to the cost of their product. This is referred to as the "landed cost" on occasion. Despite the existence of internet translators, language remains one of the most significant barriers to international trade. While translation technologies may be used to create instructions and communications in a different language, they are not without flaws. There are several examples of badly translated items with names that have been misinterpreted in another language on the market. Consider hiring a marketing firm in the targeted area or region to analyze all of the company's materials before launching the product or service. One of the primary drawbacks of international trading is that cultural differences are frequently overlooked. Unwritten norms of trade exist in the country, which is difficult to unearth and even more difficult to solve. How will overseas clients be served once they make a purchase when they are so far away? To address one of the fundamental drawbacks of international trading, linguistic and cultural differences

must once again be recognized. Your organization must be ready to connect with these consumers in multiple time zones, preferably in their native tongue, from the start. Although credit cards and internet financial tools have made the financial side of the issue easier, the actual return shipping can be just as complex and costly as it was before. A business must consider how a product will be returned and who will pay for the shipping costs. Companies will sometimes give a consumer a refund rather than requiring the item to be returned because the cost is too expensive. Every business should plan ahead of time for its return policy. According to research, Vietnam's export turnover to CPTPP nations increased in the first six months of 2019, with certain markets seeing significant increases, such as Canada (up 32.9 percent) and Mexico (up 23.4 percent ). In addition, several commodities have seen a significant growth compared to the time before the CPTPP, such as machinery, equipment, and spare parts, which have climbed by almost 125 percent in Canada and by more than 331 percent in Mexico. Even though many firms are aware of how to use the CPTPP to boost exports, statistics reveal that preferential use is still quite low. For example, out of a total of $16.4 billion in exported commodities, exports under the CPTPP form only amounted to $ 190 million, implying that just a fraction of the CPTPP's benefits were utilized.