Q1 Assume that Australia and China are trading partners. Australia initially exports coal to China and imports computers from China, Using the standard trade model, explain how an increase in the relative price of coal, in relation to computer prices, would affect the production and consumption of coal in Australia (holding consumer taste and preferences constant in both countries). Illustrate with a standard trade model. If the income effect of a price change of coal is greater than the substitution effect, what would happen to coal consumption in Australia?
Q1假设澳大利亚和中国是贸易伙伴。澳大利亚最初向中国出口煤炭，并从中国进口计算机，使用标准贸易模型，解释煤炭相对价格相对于计算机价格的上涨将如何影响澳大利亚煤炭的生产和消费（保持两国消费者的品味和偏好不变）。用一个标准的贸易模型来说明。如果煤炭价格变化的收入效应大于替代效应，澳大利亚的煤炭消费会发生什么？

Answer
回答

If the relative price of coal increases in relation to the price of computers, there would be an increase in the production of coal, because Australia exports coal. Similarly, an increase in the relative price of coal will lead to a shift along the indifference curve, towards computers and away from coal for Australia. This is because coal is relatively expensive, hence reducing coal consumption in Australia.
如果煤炭的相对价格相对于计算机的价格上涨，那么煤炭的产量就会增加，因为澳大利亚出口煤炭。同样，煤炭相对价格的上涨将导致澳大利亚的无差异曲线沿着向计算机转移，而不是煤炭。这是因为煤炭相对昂贵，因此减少了澳大利亚的煤炭消耗。

Expensive Coal increases the relative income of Australia. The income effect would induce more for the consumption of coal, whereas the substitution effect acts to make the economy consume less coal and more computers. However, if the income effect outweighs the substitution effect, then the consumption of coal would increase in Australia.
昂贵的煤炭增加了澳大利亚的相对收入。收入效应会导致更多的煤炭消费，而替代效应会使经济消耗更少的煤炭和更多的计算机。然而，如果收入效应超过替代效应，那么澳大利亚的煤炭消费将增加。

Q2 Explain the analogy between international borrowing and lending and ordinary international trade.
Q2请解释国际借贷与一般国际贸易之间的类比。

International borrowing and lending imply a trade-off between the production of current and future consumption much like trade in goods implies a trade-off between production of different goods. The more current consumption you select, the less future consumption you will be able to engage in. International borrowing and lending is driven by differences between countries in intertemporal preferences much like international trade is driven by differences between countries in technology or factor endowments. Countries with a relatively high preference for current consumption will “export” current consumption in exchange for future consumption. In other words, these countries will borrow in the current period from countries that have a relatively high preference for future consumption. Much like international trade, the relative amount of current consumption that is traded for future consumption is determined by the relative price of future consumption, defined as 1/(1 + r), where r is the real interest rate.
国际借贷意味着当前和未来消费的生产之间的权衡，就像商品贸易意味着不同商品生产之间的权衡一样。你选择的当前消费越多，你能够参与的未来消费就越少。国际借贷是由国家之间的跨期偏好差异驱动的，就像国际贸易是由国家之间的技术或要素禀赋差异驱动的一样。对当前消费偏好较高的国家将“出口”当前消费以换取未来消费。换句话说，这些国家将在当前时期向那些对未来消费有相对高偏好的国家借款。 与国际贸易类似，当前消费与未来消费的相对交易量由未来消费的相对价格决定，定义为1/（1  + r），其中r是真实的利率。

Q3 (3) Economic growth is just as likely to worsen a country’s terms of trade as it is to improve them. Why, then, do most economists regard immiserising growth, where growth actually hurts the growing country, as unlikely in practice?
Q3（3）经济增长恶化一国贸易条件的可能性与改善贸易条件的可能性相同。那么，为什么大多数经济学家认为贫困化增长（即增长实际上损害了增长中的国家）在实践中不太可能？

Immiserising growth occurs when the welfare deteriorating effects of a worsening in an economy’s terms of trade swamp the welfare improving effects of growth. For this to occur, an economy must undergo very biased growth, and the economy must be a large enough actor in the world economy such that its actions spill over to adversely alter the terms of trade to a large degree. This combination of events is unlikely to occur in practice.
贫困化增长是指一个经济体贸易条件恶化的福利恶化效应超过了增长的福利改善效应。要做到这一点，一个经济体必须经历非常偏颇的增长，而且这个经济体必须是世界经济中的一个足够大的参与者，以至于它的行动产生溢出效应，在很大程度上对贸易条件产生不利影响。实际上不太可能发生这种情况。

Q4 (4) Suppose Country X subsidises its exports and Country Y imposes a “counter-vailing” tariff that offsets the subsidy’s effect, so that in the end, relative prices in Country Y are unchanged. What happens to the terms of trade? What about welfare in the two countries? Suppose, on the other hand, that Country Y retaliates with an export subsidy of its own. Contrast the result.
问题4（4）假设X国补贴其出口，Y国征收“反补贴”关税以抵消补贴的影响，因此最终Y国的相对价格保持不变。贸易条件会发生什么变化？这两个国家的福利如何？另一方面，假设Y国以自己的出口补贴进行报复。对比结果。

What matters for welfare are the external terms of trade. Suppose that country X exports good A and imports good B, while country Y exports good B and imports good A. The export subsidy in country X will raise the internal price of the export good A, leading to an increase in production of good A and a decrease in the demand for good A. As a result, the world price of good A falls. The tariff on good A in country Y will increase the price of good A. In response to higher prices, producers will produce (supply) more of Good A and there will be a fall in the demand for good A in country Y, leading to a reduction in the world price of good A relative to good B. Thus, the terms of trade in country X fall, and the terms of trade in country Y increase. Country X is worse off, while country Y is better off. Country X lost revenue through paying subsidies, while country Y gains revenue through receiving taxes for imported goods.is better off
对福利来说，重要的是对外贸易条件。假设X国出口商品A，进口商品B，而Y国出口商品B，进口商品A。X国的出口补贴将提高出口商品A的国内价格，导致商品A的产量增加，需求减少。结果，优良A福尔斯的世界价格下跌。商品A在Y国的关税将提高商品A的价格。 作为对更高价格的反应，生产者将生产（供应）更多的商品A，Y国对商品A的需求将下降，导致商品A相对于商品B的世界价格下降。因此，X国的贸易条件下降，Y国的贸易条件上升。X国的情况更糟，而Y国的情况更好。X国通过支付补贴损失了收入，而Y国通过进口货物征税获得收入。会更好

If country Y had imposed an export subsidy on good B instead, then the internal price of good B would rise. Production of good B rises in response to higher prices of good B, and demand for good B falls due to higher prices. As a result, the world price of good B falls. The net effect on welfare is ambiguous and depends on the relative declines in the world prices of goods A and B. (Students please note that we were not told Country X imposes a “counter-vailing” tariff that offsets the subsidy’s effect in country X)
如果Y国对商品B实行出口补贴，那么商品B的国内价格就会上涨。商品B的产量随着商品B价格的上涨而上升，而商品B的需求由于价格的上涨而福尔斯。结果，好的B福尔斯的世界价格下跌。对福利的净影响是模糊的，取决于商品A和B的世界价格的相对下降。（请学生注意，我们没有被告知X国征收“反补贴”关税，以抵消补贴在X国的影响）

Q5 Which of the following countries would you expect to have intertemporal production possibilities biased toward current consumption goods, and which would be biased toward future consumption goods?
Q5你认为以下哪个国家的跨期生产可能性偏向于当前的消费品，哪个偏向于未来的消费品？

A country like Egypt that has discovered larger reserves of natural gas that can be exploited with massive investments.
像埃及这样的国家已经发现了更大的天然气储量，可以通过大规模投资进行开采。

A country like India that is catching up technologically due to massive out- sourcing services, especially from wealthy countries.
像印度这样的国家，由于大规模的外包服务，特别是来自富裕国家的外包服务，在技术上正在迎头赶上。

A country like Germany or the United States where a ban on immigration means a limited inflow of immigrants.
像德国或美国这样的国家，禁止移民意味着限制移民流入。

A country like Indonesia that started developing its infrastructure to make industries more productive and cost-efficient.
像印度尼西亚这样的国家开始发展基础设施，使工业更具生产力和成本效益。

A country like the Netherlands that aims to reduce energy and gas consumption with low investment in the use of biofuels.
像荷兰这样的国家，旨在减少能源和天然气的消耗，同时减少对生物燃料的投资。

A comparative advantage in international borrowing and lending is driven by the relative price of future consumption and, more specifically, the real interest rate. As the real interest rate rises, the relative price of future consumption 1/(1 + r) falls. Effectively, a country with a high real interest rate is one that has high returns on investment. Such a country will prefer to borrow today and take advantage of the high return on investment and enjoy the fruits of current investment with high returns in the future.
国际借贷的比较优势是由未来消费的相对价格，更具体地说，是由真实的利率驱动的。随着真实的利率上升，未来消费的相对价格1/（1 + r）福尔斯下降。实际上，一个真实的利率高的国家，投资回报率也高。这样的国家会更愿意今天借债，利用投资的高回报，在未来享受高回报的当前投资成果。

The discovery of natural gas reserves that require significant investment for extraction will cause real interest rates in Egypt to rise (large decrease in wealth). This will cause the relative price of future consumption to decrease, making it more likely that Egypt will have a PPF biased toward importing present consumption.
天然气储量的发现需要大量的开采投资，这将导致埃及的真实的利率上升（财富大幅减少）。这将导致未来消费的相对价格下降，使埃及的PPF更有可能偏向于进口目前的消费。

Countries like India will have a relatively higher interest rate, as they already have a low level of capital and limited returns on new investment. As result, the relative price of future consumption is low and they will be biased toward importing present consumption, preferring not to lend today.
像印度这样的国家将有相对较高的利率，因为它们的资本水平已经很低，新投资的回报有限。因此，未来消费的相对价格较低，他们将倾向于进口当前消费，而不愿在当前放贷。

Countries like Germany and the US should lower the real interest rate as there are fewer investment opportunities that have yet to be exploited. Those countries will have a high price of future consumption and will be biased toward importing future consumption, preferring not to borrow today.
像德国和美国这样的国家应该降低真实的利率，因为有待利用的投资机会越来越少。这些国家未来消费的价格将很高，并将倾向于进口未来消费，宁愿不借今天。

Infrastructure investments in Indonesia imply that real interest rates are high given the lucrative investment opportunities in the country. A higher real interest rate should drive the relative price of future consumption down and bias intertemporal PPF toward exporting future consumption.
印度尼西亚的基础设施投资意味着，鉴于该国有利可图的投资机会，真实的利率很高。较高的真实的利率应该会压低未来消费的相对价格，并使跨期PPF偏向于出口未来消费。

Netherlands do not require significant investments to use biofuels, which means the interest rates will fall. This will cause the relative price of future consumption to rise, making it more likely that Netherlands will have a PPF biased toward exporting present consumption.
荷兰使用生物燃料不需要大量投资，这意味着利率将会下降。这将导致未来消费的相对价格上升，使荷兰更有可能拥有偏向于出口现有消费的PPF。