Question

QUESTION1)

1) Define the potential output of a sector as the maximum sectoral output when all productive inputs are allocated to that sector.

In the long run, international migration will shift the sending country's production possibilities frontier inward. This shift will cause:

Group of answer choices:

a) a decline in the potential output of the labor-intensive sector and a rise in the potential output of the capital-intensive sector.

b) a larger decline in the potential output of the capital-intensive sector.

c) the same proportional declines in the potential outputs of both the labor-intensive and the capital-intensive sectors.

d) a larger decline in the potential output of the labor-intensive sector.

2)

Define the potential output of a sector as the maximum sectoral output when all productive inputs are allocated to that sector.

In the long run, international migration will shift the sending country's production possibilities frontier inward. This shift will cause:

Group of answer choices:

a) a decline in the potential output of the labor-intensive sector and a rise in the potential output of the capital-intensive sector.

b) a larger decline in the potential output of the capital-intensive sector.

c) the same proportional declines in the potential outputs of both the labor-intensive and the capital-intensive sectors.

d) a larger decline in the potential output of the labor-intensive sector.

3)

What is the likely attitude of capital owners toward immigration in the no-trade case?

Group of answer choices:

a) They are likely to worry about immigration issues,

b) They are likely to support more open borders and an influx of workers.

c) They are likely to reject legislation easing rules on immigration.

d) They are likely to support closing the borders to foreign labor.

These are three mcc's sub questions

Answer 1

1)let us assuke a country is producing some commoditirs using only labour and capital.so using both the factors at full optimal level we can achive the highest output a firm can produce.but now if some labourer are migrating then the total labour force for the country will fall and it has a impact also on the total output.we can see this in the following figurein this fig we can see that a firm have both the labour and capital 30 amounts and with using we can get the production possibilty curve for a good.it is highest amount of output a country can produce but when the 10 amount of labour migrate then the total workforce of the country declines and also the firms worker decreases to 20 so the prodiction possibility curve will shift inward like the fig.and this will be true for all other firms.so we can clearly see in long run international migration will shift the sending country's production possibility frontier due to a large decline in the potential output of the labour intensive sector.he we can also say that when the labour power of the country decreases then the total capital of the country is fixed so producers can't employ more capital to substitute the labour workforce thats why the country's total output will decrease.

2)question 1 and 2 are the same.

3)the attitude of the capital owners towrads immigratiin in the no-trade cases is they are likely to support more open borders and an influx of workers.and the reason is in the capital intensive country labours are very costly due to the shortage of labour in the country.but if influx of a huge labour occurs then they can employ the migrant labours at much lower cost.so tge profit level of the capital owners will increase at very high rate.on the other hand as new migrant comes then the demand for all the commodities will increase as the migrant will now demand foods and other things to live.so the economy will flourish and as the demand for their goods increase they will produce morr and earn more profit.so the capital owners wanting border to be open and more labourer to came into