The Nature and Causes of the Wealth of Nations
Write a brief 4-page long, 12-sized Arial font and doubled- spaced essay in MLA style for Works Cited containing at least 3-4 sources of information where you react to the following two scenarios- Both scenarios together should have a length of 4 typewritten pages in length plus bibliography-You may use in-text citations or/and footnotes in your narrative. Be reminded that both scenarios are part of the same assignment and worth 100 points together. Only submit a single document where you react to these scenarios separately. Do not use Wikipedia as a potential source in your separate Works-Cited page.
Scenario 1-
Contrast and compare Adam Smith’s and the mercantilists’ views on the nature and causes of the wealth of nations. In addition, reflect and explicate Adam Smith’s analysis of the consequences of self-interest coupled with competitive markets.-50 points
Scenario 2-
- Output per unit of Labor
- Wine (gallons) Cloth (yards)
Countries:
- England 12 6
- France 8 1
Both Adam Smith and David Ricardo recognized the benefits from international trade and specialization when countries have absolute advantages, but what happens when one country is more efficient?- meaning that it utilizes fewer productive resources to make goods than the other, thus making it possess a comparative advantage in producing the good or service.
- Explain your understanding of both absolute and comparative advantages and trace the motivation by Ricardo to propose this argument to the British Parliament.
- What laws was he-[Ricardo] criticizing in relation to trade and why?
- Finally, support your narrative by reacting to the following table showing the production of wine and cloth by England and France:-50 points
After you explain comparative and absolute advantages above, use the above table to determine/calculate:
- What nation has an absolute advantage in producing either or both goods? Explain briefly
- Which nation possesses a comparative advantage? Hint: Make sure to substantiate your answer by calculating opportunity costs on the table shown.
- As a result of your answer in part (b), what good should be produced and exported or not produced and imported by either country and why? Explain briefly