Measuring the joint economic activity and costs of trade


It was traditionally used for studying the trade flows associate with the same for measuring the joint economic activity and costs of trade (1, p.2, pp. 2). This model predicts that the volume of trade is directly associated with the GDP of each trading partner (country), however inversely proportional to the distance between them. In addition, distance and market size between markets determine how much nations buy and then sell, hence these transactions benefit both sellers and buyers. For example, countries tend for spending a large fraction of their income on non-traded goods and services as per the gravity model. This model influences the size of a nation’s economy on their trades and distance with other determinants that affect trade (Lec 2, p.3).

Don't use plagiarized sources. Get Your Custom Essay on
Measuring the joint economic activity and costs of trade
Just from $9/Page
Order Essay

For example, the two principal factors such as a country’s economic size and the distance between the country and its trading partner based on which predicting trade flows between nations such as Canada and the USA is to be carried out. Considering this trade between USA and Canada is found to be productive as per the two principals of each nation, for example, the market size of Canada is $1.88trillion and its GDP growth rate is 1.40, Canada is 10% of the US Market in Size and the US buys around 75% of Canada’s exports and further produces 50% of its imports. This reflects a productive trade between the US and Canada. The economys size of Canada, its GDP, its value of goods and services attract the US to trade with it. The import and export between the US and Canada can determine the size of the Canadian economy as it is directly proportional to the volume of the exports and imports. Furthermore, the US and Canada share the longest international border 5,525 miles, along with 120 land-ports-of-entry, and their bilateral relationship is one of the closet including extensive. This gets reflected in the high volume of bilateral trade of around 2billion dollar per day in goods and services, along with in people-to-people contact that is about 4200,000 people cross every day between the USA and Canada (2, pp. 1). Hence, as per the facts reflected by using the Gravity Model such as its economic size and distance between it and the US make it a perfect choice for the US to trade. Thus, Canada is the second-largest trading partner of goods for the US.



The four pillars on which the respective model are based on production possibilities frontiers, indifferences curve and isovalue lines; these fit together for illustrating how the trade partners are established by combining the factors associated with demand-side and supply-side (week 5, p.3). This model refers to a general model, which includes Hecksher-Ohlin and Ricardian models as specific cases such as two goods namely Food (F) and Cloth (C) and each of the trading countries PPF (Production Possibility Frontier) needs to be a smooth curve. For example, an economy having PPF at point TT would be producing at Q that is on the highest possible isovalue line

Relative supply and relative prices, an increase in the price of cloth relative to the price of food makes an isovalue line steeper, where production gets shifted from Q1 to point Q2 and relative supply of the clothing products to food products gets increased with a relative price of cloth to food

Furthermore, differences in labour skills, labour services, technology, land and physical capital between trading countries cause differences in the possibility frontiers. For example, an indifference curve is always downward sloping; if production of cloth is less then it is a must to have more production of cloth to be equally satisfied. This curve lies farther from the origin making the consumers satisfied, which reflects that the volume of production of both the goods are more. However, the curve becomes flatter whenever there is a shift to right reflecting more cloth with less food, this means an additional yard of clothing becomes less valuable concerning how much calories of food, one can give up for cloth.

The PPF of a country determines their relative supply functions, for example, the value of consumption associated with a nation’s economy must be equal to the value of the productions associated with the same economy (Lec 5, p.4). In the respective model, relative price converges as an outcome of the trade. For instance, if the cloth is relatively cheap in a home country and relatively costlier in a foreign country before a trade getting opened, then the effects of trade were for raising the cloth-related price in the home nation and reducing the same in the foreign country.

The functions of national relative supply determine functions of a world relative supply that along with the world relative demand determines the equilibrium under the international trade. For example, consumption choices are based on the relative price of products and preferences and the economy supplies cloth reflects that the quantity of cloth getting produced is exceeding the quality of cloth getting consumed, as a result, imports food. For instance, an economy exporting cloth is better off whenever the cloths price gets raised as compared to the price regarding food and a higher relative price of cloth reflects that more amounts of calories of food could be imported for each yard of the cloth getting exported.



The four market structures are perfect, monopoly, monopolistic and oligopoly, for example, monopoly is the market has only one firm that gives a scope to this restaurant to be a single seller selling a unique product in the Australian Food market. This type of market structure would make this business relieved from any competition as this restaurant would be the sole seller of Asian Traditional Foods with no close substitute in the respective market.

However, oligopoly is the market structure, where only a few firms exist (Lec 6, p. 9). It is also beneficial because in this market there would be a small number of firms operating in the same industry and even this business and other firms would not keep each other from having significant influence.

Furthermore, monopolistic is the market structure that is based on an imperfectly competitive marketing environment assuming that every firm can differentiate their competitor’s products, known as product differentiation. Furthermore, in this market, every firm ignores the effects that changes in their prices would have on the prices, which the competitors set, even though every firm faces the same competition and behaves as if they are monopolistic. Here, this market would offer scope to the respective business selecting an output at which the marginal revenue, an increase in their revenues from selling additional products and services, equal marginal costs with the cost of production of additional services exist. This business can differentiate its products and services from the other restaurants of Australia. This market structure gives a clear picture to the restaurant when they can enter the industry or can exit the industry, whenever the number of firms seems to be greater or even less than the equilibrium number then the firm has an incentive to enter or exit the industry. For example, if this restaurant has an incentive for entering the industry whenever their revenues would exceed all the costs and for exiting the industry whenever revenues are less than all the costs.

However, perfect competition reflects that all income from production is paid to the owners of the factors of production that is no monopoly or excess profits exist. Since, in a perfectly competitive market, a companys value is determined by replacing the costs of their capital stocks, a drop in their capital goods price leads to a drop of their firms value (Garlappi and Song, 20187 p.3, pp. 2). In this market, the proposed business would be having perfect knowledge about the market, there is no information failure and knowledge gets shared between every participant operating in this market. There are no barriers to entering, thus the existing restaurant business of the same market cannot drive any monopoly power. Unlike imperfectly competitive markets, this firm would not be dominated by any existing firms as happens in imperfect competition generating excess profits and monopoly profits (Lec 12, p.12).


Participating in the monopolistic market structure, the respective business can easily differentiate its products from the products of its competitor, with no need for the USP concept to be applied in this context. In addition, product differentiation with internal economies of scale can lead this business to trade between Australia and NZ or Australia and India, where no comparative advantage differences would exist between these two nations. Thus, trading could be an opportunity that this business would be availing in the monopolistic market. This business can easily raise the prices of its products and services somewhat above its competitor’s products because of the advantage of product differentiation. However, this business needs to compete with other firms having prices, which are believed for being uninfluenced by every firm’s actions. Thus, in future, this company would be having opportunities to increase its market size, expand its business operations, increases its product range, and many others because the respective market would allow this business for gaining profits from trade through a lower cost with price along with through a wider range of consumer choices. In addition, this business in future can engage in the intra-industry trade as well (Lec 6, p.45). As a result of getting involved in trade, the company can increase its market size, where trade would help this business for decreasing the average cost in the industry driven by a monopolistic market. Thus, getting involved in trade would increase the product varieties, which the Australian consumer could buy under this market structure; as a result, it would increase the welfare of the Australian consumers. Hence, under this market structure, the respective business can build an effective and long-lasting relationship with the Australian consumers ensuring the success rate of this business in future in the Australian food & beverage sector.

Are you in need of assignment help?

Are you a high school, college, or university student pursuing a diploma, bachelors, master’s, or Ph.D. degree? Sometimes, assignments and life can overwhelm you.

Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?

That is where we step in. Whichever your reason may is, it is valid! With our student assignment help service, you can submit all your assignment on time and score superb grades. You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.

Our academic writers are graduates with bachelor’s, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an academic writer with our assignment help service is to have a college bachelors degree. When assigning your order, we match the paper subject with the writers area of specialization.

What subjects does your online assignment help service help with?

We offer student assignment help on various subjects. These include:

  • Nursing
  • Psychology
  • Sociology
  • Business
  • Statistics
  • Finance
  • Literature
  • Law
  • Finance
  • Computer science

Why should you use our assignment help service?

  • You get unique plagiarism-free papers
  • We ensure timely delivery of all assignments
  • Papers are of unmatchable quality
  • We can handle assignments of any deadline
  • We have a pool of skilled, experienced native English writers
  • The minimum requirement to be a writer with our company is to have a bachelors degree
  • Writers go through rigorous tests and mentorship
  • You get a subject-relevant academic writer
  • We ensure strict adherence to paper instructions
  • We can handle tackle bulk assignments
  • We charge fair and reasonable prices
  • We offer awesome discounts to our clients
  • Our customer support is available 24/7
  • You get superb grades consistently
  • We guarantee 100% privacy and confidentiality
  • We are 100% legit
  • Customer satisfaction is our core priority
  • You can communicate directly with the writer
  • Our quality assurance department ensures your papers quality is top-notch
  • We have secure payment methods

How does our student assignment help service work?

1. Place an order

You fill all the paper instructions in the order form. Make sure you include all helpful materials so that our academic writers can deliver a perfect paper. It will also help to avoid unnecessary revisions. At this point, you can attach files that are provided for the assignment. We usually insist a lot on the client uploading the grading rubric if it is available. The writers adhere to the highest level of the rubric to ensure that you get a perfect grade.

2. Pay for the order

Proceed to securely pay for the paper so that we can assign the paper to one of our expert academic writers. The paper subject is matched with the writers area of specialization.

3. Track the progress

You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer.

4. Download the paper

The paper is uploaded to your personal account and sent to your email. You also get a plagiarism report attached to your paper.

Get Professional Assignment Help Cheaply

Buy Custom Essay

Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?

Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.

Why Choose Our Academic Writing Service?

  • Plagiarism free papers
  • Timely delivery
  • Any deadline
  • Skilled, Experienced Native English Writers
  • Subject-relevant academic writer
  • Adherence to paper instructions
  • Ability to tackle bulk assignments
  • Reasonable prices
  • 24/7 Customer Support
  • Get superb grades consistently

Online Academic Help With Different Subjects


Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.


Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.

Computer science

Computer science is a tough subject. Fortunately, our computer science experts are up to the match. No need to stress and have sleepless nights. Our academic writers will tackle all your computer science assignments and deliver them on time. Let us handle all your python, java, ruby, JavaScript, php , C+ assignments!


While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.


Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.


In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.


Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.


We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!


We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.


Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.

What discipline/subjects do you deal in?

We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.

Are your writers competent enough to handle my paper?

Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.

What if I don’t like the paper?

There is a very low likelihood that you won’t like the paper.

Reasons being:

  • When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
  • We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.

In the event that you don’t like your paper:

  • The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
  • We will have a different writer write the paper from scratch.
  • Last resort, if the above does not work, we will refund your money.

Will the professor find out I didn’t write the paper myself?

Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.

What if the paper is plagiarized?

We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.

When will I get my paper?

You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.

Will anyone find out that I used your services?

We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.

How our Assignment  Help Service Works

1.      Place an order

You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.

2.      Pay for the order

Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.

3.      Track the progress

You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.

4.      Download the paper

The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.

smile and order essaysmile and order essay PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET A PERFECT SCORE!!!

order custom essay paper

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more
error: Content is protected !!
Open chat
Need assignment help? You can contact our live agent via WhatsApp using +1 718 717 2861

Feel free to ask questions, clarifications, or discounts available when placing an order.
  +1 718 717 2861           + 44 161 818 7126           [email protected]
  +1 718 717 2861         [email protected]