Please answer my questions I need a perfect answer for Question 12 Thanks, 11) W
ID: 1133933 • Letter: P
Question
Please answer my questions I need a perfect answer for Question 12
Thanks, 11) Which of the following does NOT explain the extent of trade between Ireland and the U.S.? A) historical ties B) cultural Linguistic ties C) Gravity Model D) multinational corporations E) large numbers of Irish-Americans 12) When comparing the composition of world trade in the early 20th century to the early 21st century, we find major compositional changes. These include a relative decline in trade in agricultural and primary-products (including raw materials). How would you explain this in terms of broad historical developments during this period? Answer
Explanation / Answer
12)
In the beginning of international trade, agricultural products were predominant in transactions. Demand for food and other associated product was high. But gradually, relative importance of agro products declined significantly. Increase in output of manufactured goods expanded international trade incredibly. Most crucial reason for decline in relative importance of agro products, was elasticity of demand. Elasticity of demand for agro product is low relative to manufactured goods. Thus, demand for manufacturing sector jumped abruptly.
Further, due to development of technology, service trade also has increased manifold. Elasticity of demand for services in international market is very high which is driving its trade up day by day.
Thus, rise in trade in manufactured goods and services has relegated importance of agro products.