what is the current relation between Australian explanation

what is the current relation between Australian explanation of trade cycle and recent trade cycle event in demand for capital goods increases?

Solution

New Trade Theory is based on the assumption that increased firm-level production is accompanied by:

increased marginal cost

decreased average cost

decreased marginal cost

increased average cost

Decrease in average cost of production shall bring higher economies of scale under this theory’s assumptions.

The product life cycle theory distinguishes between:

tangible goods and intangible goods f

actor conditions and demand conditions

horizontal integration and vertical integration

innovating firm\'s country and other countries

The Product life cycle theory discusses about the comparative advantage that a Firm may avail when it shifts its innovative technology from its home country to the host country, which is generally a developing one.

The case for government intervention in investment has its best support in:

New Trade Theory

Relative Factor Endowments Theory

Product Life Cycle Theory

Leontief\'s Theory

The case for government intervention in investment has its best support in New Trade Theory because it is because of the active Government support that this theory shall obtain in the form of export promotion with the help of subsidies and limitations of the imports via quotas and other tariffs that shall encourage the Trade movement in the economy.