Refer to Figure 18.4. With free trade, what is the equilibrium quantity of gloves in Duckland?

Ceteris paribus, a rise in interest rates in the United States will cause the yen price of the dollar in international exchange markets to ________. I.e., the dollar ________ in value against the yen

A) decrease; depreciates B) increase; depreciates C) increase; appreciates D) decrease; appreciates

What are the key assumptions of the Lewis model that give rise to its conclusions? How would the theory's conclusions differ if these assumptions do not hold?

What will be an ideal response?