1 Welcome to EC 382: International Economics By: Dr. Jacqueline Khorassani Study Guide Week Four ( Note: You must go over these slides and complete every task outlined here before Wednesday, September 26)

2 Chapter 5 What are the causes of international factor movements? What are the effects of international factor movements? How does the international factor movement compare to international trade? –Which one is the best option and why? What is foreign direct investment?

3 International Capital Movement How much of it is going on? What are the reasons for it? What are the effects of it? –In the source country? –In the host country? –What does Figure 5.1 show? The role of government

4 International Labor Movement How much of it is going on? What are the reasons for it? –Pull/push factors What are the effects of it? –In the source country? –In the host country? –What does Figure 5.2 show? The role of government? What is brain drain?

5 Alternative to labor movement How do offshore assembly provisions work? What is Outsourcing? –Examples?

6 The Multinational Corporation What is it? Different types? What are the reasons for it? –OLI approach? –How does licensing agreement work? Examples? What is the role of government? –Different types of treatments? –Tax consequences? What is transfer pricing?

7 Chapter 6 What is a tariff? –What are the reasons for it? –What are the types of tariff? What are different methods of valuing imports? What is consumer surplus? –How is it measured? What is producer surplus? –How is it measured?

8 How does a free trade affect consumer surplus and producer surplus? In exporting nation? In importing nation?

9 What are the economic effects of tariffs The case of small importing nation –Effects on Domestic price? Quantity sold? Quantity of domestic production? Consumer surplus? Producer surplus? Efficiency in production? Redistribution of welfare? Dead weight loss? Tariff revenue?